Correlation Between Zhongsheng Group and Lookers Plc
Can any of the company-specific risk be diversified away by investing in both Zhongsheng Group and Lookers Plc 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 Lookers Plc 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 Lookers Plc, you can compare the effects of market volatilities on Zhongsheng Group and Lookers Plc 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 Lookers Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongsheng Group and Lookers Plc.
Diversification Opportunities for Zhongsheng Group and Lookers Plc
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongsheng and Lookers is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Zhongsheng Group Holdings and Lookers Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lookers Plc 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 Lookers Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lookers Plc has no effect on the direction of Zhongsheng Group i.e., Zhongsheng Group and Lookers Plc go up and down completely randomly.
Pair Corralation between Zhongsheng Group and Lookers Plc
If you would invest 1,491 in Zhongsheng Group Holdings on September 2, 2024 and sell it today you would earn a total of 647.00 from holding Zhongsheng Group Holdings or generate 43.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Zhongsheng Group Holdings vs. Lookers Plc
Performance |
| Timeline |
| Zhongsheng Group Holdings |
| Lookers Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Zhongsheng Group and Lookers Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongsheng Group and Lookers Plc
The main advantage of trading using opposite Zhongsheng Group and Lookers Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongsheng Group position performs unexpectedly, Lookers Plc 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 Lookers Plc will offset losses from the drop in Lookers Plc'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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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