Correlation Between Intel and ZTO Express
Can any of the company-specific risk be diversified away by investing in both Intel and ZTO Express at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Intel and ZTO Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and ZTO Express, you can compare the effects of market volatilities on Intel and ZTO Express 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 Intel with a short position of ZTO Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and ZTO Express.
Diversification Opportunities for Intel and ZTO Express
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Intel and ZTO is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Intel and ZTO Express in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZTO Express and Intel 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 Intel are associated (or correlated) with ZTO Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZTO Express has no effect on the direction of Intel i.e., Intel and ZTO Express go up and down completely randomly.
Pair Corralation between Intel and ZTO Express
Assuming the 90 days trading horizon Intel is expected to under-perform the ZTO Express. In addition to that, Intel is 1.33 times more volatile than ZTO Express. It trades about -0.03 of its total potential returns per unit of risk. ZTO Express is currently generating about -0.02 per unit of volatility. If you would invest 2,223 in ZTO Express on August 30, 2024 and sell it today you would lose (453.00) from holding ZTO Express or give up 20.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intel vs. ZTO Express
Performance |
| Timeline |
| Intel |
| ZTO Express |
Intel and ZTO Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and ZTO Express
The main advantage of trading using opposite Intel and ZTO Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, ZTO Express 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 ZTO Express will offset losses from the drop in ZTO Express' long position.The idea behind Intel and ZTO Express 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.| ZTO Express vs. PUBLIC STORAGE PRFO | ZTO Express vs. National Storage Affiliates | ZTO Express vs. MGIC INVESTMENT | ZTO Express vs. PennantPark 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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