Correlation Between Zhong Yang and Solstice Advanced
Can any of the company-specific risk be diversified away by investing in both Zhong Yang and Solstice Advanced 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 Zhong Yang and Solstice Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zhong Yang Financial and Solstice Advanced Materials,, you can compare the effects of market volatilities on Zhong Yang and Solstice Advanced 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 Zhong Yang with a short position of Solstice Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhong Yang and Solstice Advanced.
Diversification Opportunities for Zhong Yang and Solstice Advanced
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zhong and Solstice is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Zhong Yang Financial and Solstice Advanced Materials, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solstice Advanced and Zhong Yang 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 Zhong Yang Financial are associated (or correlated) with Solstice Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solstice Advanced has no effect on the direction of Zhong Yang i.e., Zhong Yang and Solstice Advanced go up and down completely randomly.
Pair Corralation between Zhong Yang and Solstice Advanced
Considering the 90-day investment horizon Zhong Yang Financial is expected to generate 1.93 times more return on investment than Solstice Advanced. However, Zhong Yang is 1.93 times more volatile than Solstice Advanced Materials,. It trades about 0.02 of its potential returns per unit of risk. Solstice Advanced Materials, is currently generating about 0.01 per unit of risk. If you would invest 117.00 in Zhong Yang Financial on September 3, 2025 and sell it today you would lose (6.00) from holding Zhong Yang Financial or give up 5.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 47.62% |
| Values | Daily Returns |
Zhong Yang Financial vs. Solstice Advanced Materials,
Performance |
| Timeline |
| Zhong Yang Financial |
| Solstice Advanced |
Zhong Yang and Solstice Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhong Yang and Solstice Advanced
The main advantage of trading using opposite Zhong Yang and Solstice Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhong Yang position performs unexpectedly, Solstice Advanced 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 Solstice Advanced will offset losses from the drop in Solstice Advanced's long position.| Zhong Yang vs. Solstice Advanced Materials, | Zhong Yang vs. NXP Semiconductors NV | Zhong Yang vs. Martin Marietta Materials | Zhong Yang vs. Goodyear Tire Rubber |
| Solstice Advanced vs. Pintec Technology Holdings | Solstice Advanced vs. Kingdee International Software | Solstice Advanced vs. China Life Insurance | Solstice Advanced vs. Universal Insurance Holdings |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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