Correlation Between Youyou Foods and Zhongtong Guomai
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By analyzing existing cross correlation between Youyou Foods Co and Zhongtong Guomai Communication, you can compare the effects of market volatilities on Youyou Foods and Zhongtong Guomai 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 Youyou Foods with a short position of Zhongtong Guomai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youyou Foods and Zhongtong Guomai.
Diversification Opportunities for Youyou Foods and Zhongtong Guomai
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Youyou and Zhongtong is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Youyou Foods Co and Zhongtong Guomai Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongtong Guomai Com and Youyou Foods 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 Youyou Foods Co are associated (or correlated) with Zhongtong Guomai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongtong Guomai Com has no effect on the direction of Youyou Foods i.e., Youyou Foods and Zhongtong Guomai go up and down completely randomly.
Pair Corralation between Youyou Foods and Zhongtong Guomai
Assuming the 90 days trading horizon Youyou Foods Co is expected to generate 1.07 times more return on investment than Zhongtong Guomai. However, Youyou Foods is 1.07 times more volatile than Zhongtong Guomai Communication. It trades about 0.18 of its potential returns per unit of risk. Zhongtong Guomai Communication is currently generating about -0.03 per unit of risk. If you would invest 930.00 in Youyou Foods Co on September 4, 2024 and sell it today you would earn a total of 150.00 from holding Youyou Foods Co or generate 16.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youyou Foods Co vs. Zhongtong Guomai Communication
Performance |
| Timeline |
| Youyou Foods |
| Zhongtong Guomai Com |
Youyou Foods and Zhongtong Guomai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youyou Foods and Zhongtong Guomai
The main advantage of trading using opposite Youyou Foods and Zhongtong Guomai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youyou Foods position performs unexpectedly, Zhongtong Guomai 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 Zhongtong Guomai will offset losses from the drop in Zhongtong Guomai's long position.| Youyou Foods vs. Poly Real Estate | Youyou Foods vs. China Vanke Co | Youyou Foods vs. China Merchants Shekou | Youyou Foods vs. Huafa Industrial Co |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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