Correlation Between Hangzhou Pinming and Shenzhen Zhongzhuang
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By analyzing existing cross correlation between Hangzhou Pinming Software and Shenzhen Zhongzhuang Construction, you can compare the effects of market volatilities on Hangzhou Pinming and Shenzhen Zhongzhuang 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 Hangzhou Pinming with a short position of Shenzhen Zhongzhuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Pinming and Shenzhen Zhongzhuang.
Diversification Opportunities for Hangzhou Pinming and Shenzhen Zhongzhuang
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hangzhou and Shenzhen is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Pinming Software and Shenzhen Zhongzhuang Construct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Zhongzhuang and Hangzhou Pinming 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 Hangzhou Pinming Software are associated (or correlated) with Shenzhen Zhongzhuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Zhongzhuang has no effect on the direction of Hangzhou Pinming i.e., Hangzhou Pinming and Shenzhen Zhongzhuang go up and down completely randomly.
Pair Corralation between Hangzhou Pinming and Shenzhen Zhongzhuang
Assuming the 90 days trading horizon Hangzhou Pinming Software is expected to generate 1.0 times more return on investment than Shenzhen Zhongzhuang. However, Hangzhou Pinming is 1.0 times more volatile than Shenzhen Zhongzhuang Construction. It trades about 0.02 of its potential returns per unit of risk. Shenzhen Zhongzhuang Construction is currently generating about -0.01 per unit of risk. If you would invest 2,411 in Hangzhou Pinming Software on October 16, 2024 and sell it today you would lose (82.00) from holding Hangzhou Pinming Software or give up 3.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Pinming Software vs. Shenzhen Zhongzhuang Construct
Performance |
| Timeline |
| Hangzhou Pinming Software |
| Shenzhen Zhongzhuang |
Hangzhou Pinming and Shenzhen Zhongzhuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Pinming and Shenzhen Zhongzhuang
The main advantage of trading using opposite Hangzhou Pinming and Shenzhen Zhongzhuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Pinming position performs unexpectedly, Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang will offset losses from the drop in Shenzhen Zhongzhuang's long position.| Hangzhou Pinming vs. Eastern Communications Co | Hangzhou Pinming vs. Shanghai Shibei Hi Tech | Hangzhou Pinming vs. Shandong Sanyuan Biotechnology | Hangzhou Pinming vs. Anhui Huaheng Biotechnology |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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