Correlation Between ZhongAn Online and W R

Can any of the company-specific risk be diversified away by investing in both ZhongAn Online and W R 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 ZhongAn Online and W R into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ZhongAn Online P and W R Berkley, you can compare the effects of market volatilities on ZhongAn Online and W R 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 ZhongAn Online with a short position of W R. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZhongAn Online and W R.

Diversification Opportunities for ZhongAn Online and W R

-0.06

Correlation Coefficient

ZhongAn Online  W R

Good diversification

The 3 months correlation between ZhongAn and WR1 is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding ZhongAn Online P and W R Berkley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on W R Berkley and ZhongAn Online 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 ZhongAn Online P are associated (or correlated) with W R. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of W R Berkley has no effect on the direction of ZhongAn Online i.e., ZhongAn Online and W R go up and down completely randomly.

Pair Corralation between ZhongAn Online and W R

Assuming the 90 days horizon ZhongAn Online P is expected to generate 4.32 times more return on investment than W R. However, ZhongAn Online is 4.32 times more volatile than W R Berkley. It trades about 0.18 of its potential returns per unit of risk. W R Berkley is currently generating about 0.01 per unit of risk. If you would invest  119.00  in ZhongAn Online P on April 22, 2025 and sell it today you would earn a total of  90.00  from holding ZhongAn Online P or generate 75.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ZhongAn Online P  vs.  W R Berkley

ZhongAn Online P

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ZhongAn Online P are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ZhongAn Online reported solid returns over the last few months and may actually be approaching a breakup point.

W R Berkley

Risk-Adjusted Performance

Very Weak

Over the last 90 days W R Berkley has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, W R is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ZhongAn Online and W R

The main advantage of trading using opposite ZhongAn Online and W R positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZhongAn Online position performs unexpectedly, W R 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 W R will offset losses from the drop in W R's long position.

The idea behind ZhongAn Online P and W R Berkley pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.