Correlation Between Dazhong Transportation and Qilu Bank
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By analyzing existing cross correlation between Dazhong Transportation Group and Qilu Bank Co, you can compare the effects of market volatilities on Dazhong Transportation and Qilu Bank 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 Dazhong Transportation with a short position of Qilu Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dazhong Transportation and Qilu Bank.
Diversification Opportunities for Dazhong Transportation and Qilu Bank
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dazhong and Qilu is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Dazhong Transportation Group and Qilu Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qilu Bank and Dazhong Transportation 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 Dazhong Transportation Group are associated (or correlated) with Qilu Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qilu Bank has no effect on the direction of Dazhong Transportation i.e., Dazhong Transportation and Qilu Bank go up and down completely randomly.
Pair Corralation between Dazhong Transportation and Qilu Bank
Assuming the 90 days trading horizon Dazhong Transportation is expected to generate 2.06 times less return on investment than Qilu Bank. In addition to that, Dazhong Transportation is 1.11 times more volatile than Qilu Bank Co. It trades about 0.12 of its total potential returns per unit of risk. Qilu Bank Co is currently generating about 0.27 per unit of volatility. If you would invest 528.00 in Qilu Bank Co on November 8, 2024 and sell it today you would earn a total of 54.00 from holding Qilu Bank Co or generate 10.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dazhong Transportation Group vs. Qilu Bank Co
Performance |
| Timeline |
| Dazhong Transportation |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Qilu Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Dazhong Transportation and Qilu Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dazhong Transportation and Qilu Bank
The main advantage of trading using opposite Dazhong Transportation and Qilu Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dazhong Transportation position performs unexpectedly, Qilu Bank 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 Qilu Bank will offset losses from the drop in Qilu Bank's long position.The idea behind Dazhong Transportation Group and Qilu Bank Co 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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