Correlation Between Zhongtong Guomai and Liaoning Chengda
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By analyzing existing cross correlation between Zhongtong Guomai Communication and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on Zhongtong Guomai and Liaoning Chengda 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 Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongtong Guomai and Liaoning Chengda.
Diversification Opportunities for Zhongtong Guomai and Liaoning Chengda
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Zhongtong and Liaoning is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Zhongtong Guomai Communication and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio 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 Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of Zhongtong Guomai i.e., Zhongtong Guomai and Liaoning Chengda go up and down completely randomly.
Pair Corralation between Zhongtong Guomai and Liaoning Chengda
Assuming the 90 days trading horizon Zhongtong Guomai Communication is expected to under-perform the Liaoning Chengda. In addition to that, Zhongtong Guomai is 7.14 times more volatile than Liaoning Chengda Biotechnology. It trades about -0.08 of its total potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about -0.51 per unit of volatility. If you would invest 2,772 in Liaoning Chengda Biotechnology on October 9, 2024 and sell it today you would lose (273.00) from holding Liaoning Chengda Biotechnology or give up 9.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongtong Guomai Communication vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| Zhongtong Guomai Com |
| Liaoning Chengda Bio |
Zhongtong Guomai and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongtong Guomai and Liaoning Chengda
The main advantage of trading using opposite Zhongtong Guomai and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongtong Guomai position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| Zhongtong Guomai vs. Linewell Software Co | Zhongtong Guomai vs. Digiwin Software Co | Zhongtong Guomai vs. Sichuan Fulin Transportation | Zhongtong Guomai vs. Shandong Hi Speed RoadBridge |
| Liaoning Chengda vs. Ming Yang Smart | Liaoning Chengda vs. 159681 | Liaoning Chengda vs. 159005 | Liaoning Chengda vs. Loctek Ergonomic 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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