Correlation Between REPUBLIC and Zhihu
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By analyzing existing cross correlation between REPUBLIC SVCS INC and Zhihu Inc ADR, you can compare the effects of market volatilities on REPUBLIC 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 REPUBLIC with a short position of Zhihu. Check out your portfolio center. Please also check ongoing floating volatility patterns of REPUBLIC and Zhihu.
Diversification Opportunities for REPUBLIC and Zhihu
Excellent diversification
The 3 months correlation between REPUBLIC and Zhihu is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding REPUBLIC SVCS INC 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 REPUBLIC 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 REPUBLIC SVCS INC 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 REPUBLIC i.e., REPUBLIC and Zhihu go up and down completely randomly.
Pair Corralation between REPUBLIC and Zhihu
Assuming the 90 days trading horizon REPUBLIC is expected to generate 11.55 times less return on investment than Zhihu. But when comparing it to its historical volatility, REPUBLIC SVCS INC is 20.06 times less risky than Zhihu. It trades about 0.15 of its potential returns per unit of risk. Zhihu Inc ADR is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 334.00 in Zhihu Inc ADR on November 9, 2024 and sell it today you would earn a total of 11.00 from holding Zhihu Inc ADR or generate 3.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
REPUBLIC SVCS INC vs. Zhihu Inc ADR
Performance |
| Timeline |
| REPUBLIC SVCS INC |
| Zhihu Inc ADR |
REPUBLIC and Zhihu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REPUBLIC and Zhihu
The main advantage of trading using opposite REPUBLIC and Zhihu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REPUBLIC 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.| REPUBLIC vs. Robix Environmental Technologies | REPUBLIC vs. Universal Technical Institute | REPUBLIC vs. Graham Holdings Co | REPUBLIC vs. Zane Interactive Publishing |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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