Correlation Between Heilongjiang Publishing and Zhongrun Resources
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By analyzing existing cross correlation between Heilongjiang Publishing Media and Zhongrun Resources Investment, you can compare the effects of market volatilities on Heilongjiang Publishing and Zhongrun Resources 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 Heilongjiang Publishing with a short position of Zhongrun Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Publishing and Zhongrun Resources.
Diversification Opportunities for Heilongjiang Publishing and Zhongrun Resources
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Heilongjiang and Zhongrun is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Publishing Media and Zhongrun Resources Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongrun Resources and Heilongjiang Publishing 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 Heilongjiang Publishing Media are associated (or correlated) with Zhongrun Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongrun Resources has no effect on the direction of Heilongjiang Publishing i.e., Heilongjiang Publishing and Zhongrun Resources go up and down completely randomly.
Pair Corralation between Heilongjiang Publishing and Zhongrun Resources
Assuming the 90 days trading horizon Heilongjiang Publishing Media is expected to under-perform the Zhongrun Resources. But the stock apears to be less risky and, when comparing its historical volatility, Heilongjiang Publishing Media is 1.33 times less risky than Zhongrun Resources. The stock trades about -0.11 of its potential returns per unit of risk. The Zhongrun Resources Investment is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 381.00 in Zhongrun Resources Investment on October 29, 2024 and sell it today you would earn a total of 8.00 from holding Zhongrun Resources Investment or generate 2.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Publishing Media vs. Zhongrun Resources Investment
Performance |
| Timeline |
| Heilongjiang Publishing |
| Zhongrun Resources |
Heilongjiang Publishing and Zhongrun Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Publishing and Zhongrun Resources
The main advantage of trading using opposite Heilongjiang Publishing and Zhongrun Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Publishing position performs unexpectedly, Zhongrun Resources 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 Zhongrun Resources will offset losses from the drop in Zhongrun Resources' long position.The idea behind Heilongjiang Publishing Media and Zhongrun Resources Investment 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.
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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