Correlation Between Zhongyin Babi and Sinomach Automobile
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By analyzing existing cross correlation between Zhongyin Babi Food and Sinomach Automobile Co, you can compare the effects of market volatilities on Zhongyin Babi and Sinomach Automobile 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 Zhongyin Babi with a short position of Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongyin Babi and Sinomach Automobile.
Diversification Opportunities for Zhongyin Babi and Sinomach Automobile
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhongyin and Sinomach is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Zhongyin Babi Food and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile and Zhongyin Babi 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 Zhongyin Babi Food are associated (or correlated) with Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Zhongyin Babi i.e., Zhongyin Babi and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Zhongyin Babi and Sinomach Automobile
Assuming the 90 days trading horizon Zhongyin Babi Food is expected to generate 0.95 times more return on investment than Sinomach Automobile. However, Zhongyin Babi Food is 1.06 times less risky than Sinomach Automobile. It trades about -0.06 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about -0.14 per unit of risk. If you would invest 1,775 in Zhongyin Babi Food on October 22, 2024 and sell it today you would lose (49.00) from holding Zhongyin Babi Food or give up 2.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongyin Babi Food vs. Sinomach Automobile Co
Performance |
| Timeline |
| Zhongyin Babi Food |
| Sinomach Automobile |
Zhongyin Babi and Sinomach Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongyin Babi and Sinomach Automobile
The main advantage of trading using opposite Zhongyin Babi and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongyin Babi position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.| Zhongyin Babi vs. Panda Financial Holding | Zhongyin Babi vs. Shanghai Yanpu Metal | Zhongyin Babi vs. Guocheng Mining Co | Zhongyin Babi vs. Postal Savings Bank |
| Sinomach Automobile vs. Zhongyin Babi Food | Sinomach Automobile vs. Suzhou Weizhixiang Food | Sinomach Automobile vs. Panda Dairy Corp | Sinomach Automobile vs. Chongqing Sulian Plastic |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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