Correlation Between Zhejiang Xiantong and Dezhan HealthCare
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By analyzing existing cross correlation between Zhejiang Xiantong RubberPlastic and Dezhan HealthCare Co, you can compare the effects of market volatilities on Zhejiang Xiantong and Dezhan HealthCare 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 Zhejiang Xiantong with a short position of Dezhan HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Xiantong and Dezhan HealthCare.
Diversification Opportunities for Zhejiang Xiantong and Dezhan HealthCare
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhejiang and Dezhan is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Xiantong RubberPlasti and Dezhan HealthCare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dezhan HealthCare and Zhejiang Xiantong 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 Zhejiang Xiantong RubberPlastic are associated (or correlated) with Dezhan HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dezhan HealthCare has no effect on the direction of Zhejiang Xiantong i.e., Zhejiang Xiantong and Dezhan HealthCare go up and down completely randomly.
Pair Corralation between Zhejiang Xiantong and Dezhan HealthCare
Assuming the 90 days trading horizon Zhejiang Xiantong is expected to generate 5.3 times less return on investment than Dezhan HealthCare. But when comparing it to its historical volatility, Zhejiang Xiantong RubberPlastic is 1.14 times less risky than Dezhan HealthCare. It trades about 0.01 of its potential returns per unit of risk. Dezhan HealthCare Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 332.00 in Dezhan HealthCare Co on September 14, 2024 and sell it today you would earn a total of 88.00 from holding Dezhan HealthCare Co or generate 26.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Xiantong RubberPlasti vs. Dezhan HealthCare Co
Performance |
| Timeline |
| Zhejiang Xiantong |
| Dezhan HealthCare |
Zhejiang Xiantong and Dezhan HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Xiantong and Dezhan HealthCare
The main advantage of trading using opposite Zhejiang Xiantong and Dezhan HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Xiantong position performs unexpectedly, Dezhan HealthCare 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 Dezhan HealthCare will offset losses from the drop in Dezhan HealthCare's long position.| Zhejiang Xiantong vs. Jiahe Foods Industry | Zhejiang Xiantong vs. Jiangsu Financial Leasing | Zhejiang Xiantong vs. Bus Online Co | Zhejiang Xiantong vs. Youyou Foods Co |
| Dezhan HealthCare vs. BeiGene | Dezhan HealthCare vs. Kweichow Moutai Co | Dezhan HealthCare vs. Beijing Roborock Technology | Dezhan HealthCare vs. G bits Network Technology |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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