Correlation Between Zhongtong Guomai and Zhangjiagang Freetrade
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By analyzing existing cross correlation between Zhongtong Guomai Communication and Zhangjiagang Freetrade Science, you can compare the effects of market volatilities on Zhongtong Guomai and Zhangjiagang Freetrade 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 Zhangjiagang Freetrade. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongtong Guomai and Zhangjiagang Freetrade.
Diversification Opportunities for Zhongtong Guomai and Zhangjiagang Freetrade
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhongtong and Zhangjiagang is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Zhongtong Guomai Communication and Zhangjiagang Freetrade Science in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhangjiagang Freetrade 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 Zhangjiagang Freetrade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhangjiagang Freetrade has no effect on the direction of Zhongtong Guomai i.e., Zhongtong Guomai and Zhangjiagang Freetrade go up and down completely randomly.
Pair Corralation between Zhongtong Guomai and Zhangjiagang Freetrade
Assuming the 90 days trading horizon Zhongtong Guomai Communication is expected to generate 1.6 times more return on investment than Zhangjiagang Freetrade. However, Zhongtong Guomai is 1.6 times more volatile than Zhangjiagang Freetrade Science. It trades about 0.18 of its potential returns per unit of risk. Zhangjiagang Freetrade Science is currently generating about 0.18 per unit of risk. If you would invest 769.00 in Zhongtong Guomai Communication on September 3, 2024 and sell it today you would earn a total of 352.00 from holding Zhongtong Guomai Communication or generate 45.77% 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. Zhangjiagang Freetrade Science
Performance |
| Timeline |
| Zhongtong Guomai Com |
| Zhangjiagang Freetrade |
Zhongtong Guomai and Zhangjiagang Freetrade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongtong Guomai and Zhangjiagang Freetrade
The main advantage of trading using opposite Zhongtong Guomai and Zhangjiagang Freetrade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongtong Guomai position performs unexpectedly, Zhangjiagang Freetrade 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 Zhangjiagang Freetrade will offset losses from the drop in Zhangjiagang Freetrade's 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 |
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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