Correlation Between Zhejiang HISUN and Nanjing Putian
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By analyzing existing cross correlation between Zhejiang HISUN Biomaterials and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Zhejiang HISUN and Nanjing Putian 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 Zhejiang HISUN with a short position of Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang HISUN and Nanjing Putian.
Diversification Opportunities for Zhejiang HISUN and Nanjing Putian
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and Nanjing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang HISUN Biomaterials and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec and Zhejiang HISUN 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 Zhejiang HISUN Biomaterials are associated (or correlated) with Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Zhejiang HISUN i.e., Zhejiang HISUN and Nanjing Putian go up and down completely randomly.
Pair Corralation between Zhejiang HISUN and Nanjing Putian
Assuming the 90 days trading horizon Zhejiang HISUN Biomaterials is expected to generate 0.36 times more return on investment than Nanjing Putian. However, Zhejiang HISUN Biomaterials is 2.8 times less risky than Nanjing Putian. It trades about 0.02 of its potential returns per unit of risk. Nanjing Putian Telecommunications is currently generating about -0.03 per unit of risk. If you would invest 1,080 in Zhejiang HISUN Biomaterials on September 13, 2024 and sell it today you would earn a total of 3.00 from holding Zhejiang HISUN Biomaterials or generate 0.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang HISUN Biomaterials vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Zhejiang HISUN Bioma |
| Nanjing Putian Telec |
Zhejiang HISUN and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang HISUN and Nanjing Putian
The main advantage of trading using opposite Zhejiang HISUN and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang HISUN position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Zhejiang HISUN vs. Luyin Investment Group | Zhejiang HISUN vs. Hubei Geoway Investment | Zhejiang HISUN vs. Beijing Mainstreets Investment | Zhejiang HISUN vs. Nuode Investment Co |
| Nanjing Putian vs. Industrial and Commercial | Nanjing Putian vs. China Construction Bank | Nanjing Putian vs. Bank of China | Nanjing Putian vs. Agricultural Bank of |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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