Correlation Between Zhongsheng Group and Grand Baoxin
Can any of the company-specific risk be diversified away by investing in both Zhongsheng Group and Grand Baoxin 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 Zhongsheng Group and Grand Baoxin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zhongsheng Group Holdings and Grand Baoxin Auto, you can compare the effects of market volatilities on Zhongsheng Group and Grand Baoxin 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 Zhongsheng Group with a short position of Grand Baoxin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongsheng Group and Grand Baoxin.
Diversification Opportunities for Zhongsheng Group and Grand Baoxin
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Zhongsheng and Grand is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Zhongsheng Group Holdings and Grand Baoxin Auto in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Baoxin Auto and Zhongsheng Group 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 Zhongsheng Group Holdings are associated (or correlated) with Grand Baoxin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Baoxin Auto has no effect on the direction of Zhongsheng Group i.e., Zhongsheng Group and Grand Baoxin go up and down completely randomly.
Pair Corralation between Zhongsheng Group and Grand Baoxin
If you would invest 9.24 in Grand Baoxin Auto on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Grand Baoxin Auto or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongsheng Group Holdings vs. Grand Baoxin Auto
Performance |
| Timeline |
| Zhongsheng Group Holdings |
| Grand Baoxin Auto |
Zhongsheng Group and Grand Baoxin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongsheng Group and Grand Baoxin
The main advantage of trading using opposite Zhongsheng Group and Grand Baoxin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongsheng Group position performs unexpectedly, Grand Baoxin 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 Grand Baoxin will offset losses from the drop in Grand Baoxin's long position.| Zhongsheng Group vs. Vroom Inc | Zhongsheng Group vs. CarMax Inc | Zhongsheng Group vs. SunCar Technology Group | Zhongsheng Group vs. U Power Limited |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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