Correlation Between Treasury Wine and Zhihu
Can any of the company-specific risk be diversified away by investing in both Treasury Wine and Zhihu 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 Treasury Wine and Zhihu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Treasury Wine Estates and Zhihu Inc ADR, you can compare the effects of market volatilities on Treasury Wine and Zhihu 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 Treasury Wine with a short position of Zhihu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Treasury Wine and Zhihu.
Diversification Opportunities for Treasury Wine and Zhihu
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Treasury and Zhihu is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Treasury Wine Estates and Zhihu Inc ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhihu Inc ADR and Treasury Wine 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 Treasury Wine Estates are associated (or correlated) with Zhihu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhihu Inc ADR has no effect on the direction of Treasury Wine i.e., Treasury Wine and Zhihu go up and down completely randomly.
Pair Corralation between Treasury Wine and Zhihu
Assuming the 90 days horizon Treasury Wine Estates is expected to under-perform the Zhihu. But the pink sheet apears to be less risky and, when comparing its historical volatility, Treasury Wine Estates is 1.58 times less risky than Zhihu. The pink sheet trades about -0.04 of its potential returns per unit of risk. The Zhihu Inc ADR is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 341.00 in Zhihu Inc ADR on September 5, 2024 and sell it today you would earn a total of 35.00 from holding Zhihu Inc ADR or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Treasury Wine Estates vs. Zhihu Inc ADR
Performance |
| Timeline |
| Treasury Wine Estates |
| Zhihu Inc ADR |
Treasury Wine and Zhihu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Treasury Wine and Zhihu
The main advantage of trading using opposite Treasury Wine and Zhihu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Treasury Wine position performs unexpectedly, Zhihu 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 Zhihu will offset losses from the drop in Zhihu's long position.| Treasury Wine vs. Pernod Ricard SA | Treasury Wine vs. Willamette Valley Vineyards | Treasury Wine vs. MGP Ingredients | Treasury Wine vs. Duckhorn Portfolio |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |