Correlation Between Zhongyin Babi and Cansino Biologics
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By analyzing existing cross correlation between Zhongyin Babi Food and Cansino Biologics, you can compare the effects of market volatilities on Zhongyin Babi and Cansino Biologics 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 Cansino Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongyin Babi and Cansino Biologics.
Diversification Opportunities for Zhongyin Babi and Cansino Biologics
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Zhongyin and Cansino is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Zhongyin Babi Food and Cansino Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cansino Biologics 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 Cansino Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cansino Biologics has no effect on the direction of Zhongyin Babi i.e., Zhongyin Babi and Cansino Biologics go up and down completely randomly.
Pair Corralation between Zhongyin Babi and Cansino Biologics
Assuming the 90 days trading horizon Zhongyin Babi Food is expected to generate 1.49 times more return on investment than Cansino Biologics. However, Zhongyin Babi is 1.49 times more volatile than Cansino Biologics. It trades about 0.22 of its potential returns per unit of risk. Cansino Biologics is currently generating about -0.07 per unit of risk. If you would invest 1,650 in Zhongyin Babi Food on November 7, 2024 and sell it today you would earn a total of 177.00 from holding Zhongyin Babi Food or generate 10.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongyin Babi Food vs. Cansino Biologics
Performance |
| Timeline |
| Zhongyin Babi Food |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Cansino Biologics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Zhongyin Babi and Cansino Biologics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongyin Babi and Cansino Biologics
The main advantage of trading using opposite Zhongyin Babi and Cansino Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongyin Babi position performs unexpectedly, Cansino Biologics 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 Cansino Biologics will offset losses from the drop in Cansino Biologics' long position.The idea behind Zhongyin Babi Food and Cansino Biologics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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