Correlation Between Zhongtong Guomai and Central Plains
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By analyzing existing cross correlation between Zhongtong Guomai Communication and Central Plains Environment, you can compare the effects of market volatilities on Zhongtong Guomai and Central Plains 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 Zhongtong Guomai with a short position of Central Plains. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongtong Guomai and Central Plains.
Diversification Opportunities for Zhongtong Guomai and Central Plains
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhongtong and Central is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Zhongtong Guomai Communication and Central Plains Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Plains Envir and Zhongtong Guomai 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 Zhongtong Guomai Communication are associated (or correlated) with Central Plains. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Plains Envir has no effect on the direction of Zhongtong Guomai i.e., Zhongtong Guomai and Central Plains go up and down completely randomly.
Pair Corralation between Zhongtong Guomai and Central Plains
Assuming the 90 days trading horizon Zhongtong Guomai Communication is expected to generate 1.58 times more return on investment than Central Plains. However, Zhongtong Guomai is 1.58 times more volatile than Central Plains Environment. It trades about 0.29 of its potential returns per unit of risk. Central Plains Environment is currently generating about 0.02 per unit of risk. If you would invest 741.00 in Zhongtong Guomai Communication on September 3, 2024 and sell it today you would earn a total of 380.00 from holding Zhongtong Guomai Communication or generate 51.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongtong Guomai Communication vs. Central Plains Environment
Performance |
| Timeline |
| Zhongtong Guomai Com |
| Central Plains Envir |
Zhongtong Guomai and Central Plains Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongtong Guomai and Central Plains
The main advantage of trading using opposite Zhongtong Guomai and Central Plains positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongtong Guomai position performs unexpectedly, Central Plains 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 Central Plains will offset losses from the drop in Central Plains' long position.| Zhongtong Guomai vs. Agricultural Bank of | Zhongtong Guomai vs. China Construction Bank | Zhongtong Guomai vs. Postal Savings Bank | Zhongtong Guomai vs. Bank of Communications |
| Central Plains vs. Cultural Investment Holdings | Central Plains vs. Gome Telecom Equipment | Central Plains vs. Bus Online Co | Central Plains vs. Holitech Technology 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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