Correlation Between Industrial and Zoomlion Heavy
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By analyzing existing cross correlation between Industrial and Commercial and Zoomlion Heavy Industry, you can compare the effects of market volatilities on Industrial and Zoomlion Heavy 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 Industrial with a short position of Zoomlion Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Zoomlion Heavy.
Diversification Opportunities for Industrial and Zoomlion Heavy
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Zoomlion is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Zoomlion Heavy Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoomlion Heavy Industry and Industrial 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 Industrial and Commercial are associated (or correlated) with Zoomlion Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoomlion Heavy Industry has no effect on the direction of Industrial i.e., Industrial and Zoomlion Heavy go up and down completely randomly.
Pair Corralation between Industrial and Zoomlion Heavy
Assuming the 90 days trading horizon Industrial is expected to generate 1.02 times less return on investment than Zoomlion Heavy. But when comparing it to its historical volatility, Industrial and Commercial is 1.59 times less risky than Zoomlion Heavy. It trades about 0.15 of its potential returns per unit of risk. Zoomlion Heavy Industry is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 610.00 in Zoomlion Heavy Industry on September 23, 2024 and sell it today you would earn a total of 81.00 from holding Zoomlion Heavy Industry or generate 13.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Industrial and Commercial vs. Zoomlion Heavy Industry
Performance |
Timeline |
Industrial and Commercial |
Zoomlion Heavy Industry |
Industrial and Zoomlion Heavy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Industrial and Zoomlion Heavy
The main advantage of trading using opposite Industrial and Zoomlion Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Zoomlion Heavy 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 Zoomlion Heavy will offset losses from the drop in Zoomlion Heavy's long position.Industrial vs. Kweichow Moutai Co | Industrial vs. Agricultural Bank of | Industrial vs. China Mobile Limited | Industrial vs. China Construction Bank |
Zoomlion Heavy vs. Industrial and Commercial | Zoomlion Heavy vs. Agricultural Bank of | Zoomlion Heavy vs. China Construction Bank | Zoomlion Heavy vs. Bank of China |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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