Correlation Between Beijing Kingsoft and Zoomlion Heavy
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By analyzing existing cross correlation between Beijing Kingsoft Office and Zoomlion Heavy Industry, you can compare the effects of market volatilities on Beijing Kingsoft and Zoomlion Heavy 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 Beijing Kingsoft with a short position of Zoomlion Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Kingsoft and Zoomlion Heavy.
Diversification Opportunities for Beijing Kingsoft and Zoomlion Heavy
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Zoomlion is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Kingsoft Office and Zoomlion Heavy Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoomlion Heavy Industry and Beijing Kingsoft 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 Beijing Kingsoft Office are associated (or correlated) with Zoomlion Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoomlion Heavy Industry has no effect on the direction of Beijing Kingsoft i.e., Beijing Kingsoft and Zoomlion Heavy go up and down completely randomly.
Pair Corralation between Beijing Kingsoft and Zoomlion Heavy
Assuming the 90 days trading horizon Beijing Kingsoft is expected to generate 2.64 times less return on investment than Zoomlion Heavy. In addition to that, Beijing Kingsoft is 1.98 times more volatile than Zoomlion Heavy Industry. It trades about 0.03 of its total potential returns per unit of risk. Zoomlion Heavy Industry is currently generating about 0.15 per unit of volatility. If you would invest 688.00 in Zoomlion Heavy Industry on September 27, 2024 and sell it today you would earn a total of 31.00 from holding Zoomlion Heavy Industry or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Beijing Kingsoft Office vs. Zoomlion Heavy Industry
Performance |
| Timeline |
| Beijing Kingsoft Office |
| Zoomlion Heavy Industry |
Beijing Kingsoft and Zoomlion Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Kingsoft and Zoomlion Heavy
The main advantage of trading using opposite Beijing Kingsoft and Zoomlion Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Kingsoft position performs unexpectedly, Zoomlion Heavy 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 Zoomlion Heavy will offset losses from the drop in Zoomlion Heavy's long position.| Beijing Kingsoft vs. Industrial and Commercial | Beijing Kingsoft vs. Agricultural Bank of | Beijing Kingsoft vs. China Construction Bank | Beijing Kingsoft vs. Bank of China |
| Zoomlion Heavy vs. Industrial and Commercial | Zoomlion Heavy vs. Agricultural Bank of | Zoomlion Heavy vs. China Construction Bank | Zoomlion Heavy vs. Bank of China |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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