Correlation Between China Zheshang and Gansu Yasheng
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By analyzing existing cross correlation between China Zheshang Bank and Gansu Yasheng Industrial, you can compare the effects of market volatilities on China Zheshang and Gansu Yasheng and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in China Zheshang with a short position of Gansu Yasheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Zheshang and Gansu Yasheng.
Diversification Opportunities for China Zheshang and Gansu Yasheng
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Gansu is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding China Zheshang Bank and Gansu Yasheng Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Yasheng Industrial and China Zheshang is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on China Zheshang Bank are associated (or correlated) with Gansu Yasheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Yasheng Industrial has no effect on the direction of China Zheshang i.e., China Zheshang and Gansu Yasheng go up and down completely randomly.
Pair Corralation between China Zheshang and Gansu Yasheng
Assuming the 90 days trading horizon China Zheshang is expected to generate 3.51 times less return on investment than Gansu Yasheng. But when comparing it to its historical volatility, China Zheshang Bank is 2.19 times less risky than Gansu Yasheng. It trades about 0.11 of its potential returns per unit of risk. Gansu Yasheng Industrial is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 282.00 in Gansu Yasheng Industrial on September 5, 2024 and sell it today you would earn a total of 28.00 from holding Gansu Yasheng Industrial or generate 9.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Zheshang Bank vs. Gansu Yasheng Industrial
Performance |
| Timeline |
| China Zheshang Bank |
| Gansu Yasheng Industrial |
China Zheshang and Gansu Yasheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Zheshang and Gansu Yasheng
The main advantage of trading using opposite China Zheshang and Gansu Yasheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Zheshang position performs unexpectedly, Gansu Yasheng can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Gansu Yasheng will offset losses from the drop in Gansu Yasheng's long position.| China Zheshang vs. Gansu Yasheng Industrial | China Zheshang vs. Ye Chiu Metal | China Zheshang vs. Weichai Heavy Machinery | China Zheshang vs. Sino Platinum Metals Co |
| Gansu Yasheng vs. Tianshui Huatian Technology | Gansu Yasheng vs. Sino Platinum Metals Co | Gansu Yasheng vs. HUAQIN TECHNOLOGY LTD | Gansu Yasheng vs. Dhc Software Co |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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