Correlation Between China Vanke and Muyuan Foodstuff
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By analyzing existing cross correlation between China Vanke Co and Muyuan Foodstuff Co, you can compare the effects of market volatilities on China Vanke and Muyuan Foodstuff 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 China Vanke with a short position of Muyuan Foodstuff. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Vanke and Muyuan Foodstuff.
Diversification Opportunities for China Vanke and Muyuan Foodstuff
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Muyuan is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding China Vanke Co and Muyuan Foodstuff Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Muyuan Foodstuff and China Vanke 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 China Vanke Co are associated (or correlated) with Muyuan Foodstuff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Muyuan Foodstuff has no effect on the direction of China Vanke i.e., China Vanke and Muyuan Foodstuff go up and down completely randomly.
Pair Corralation between China Vanke and Muyuan Foodstuff
Assuming the 90 days trading horizon China Vanke Co is expected to under-perform the Muyuan Foodstuff. In addition to that, China Vanke is 1.31 times more volatile than Muyuan Foodstuff Co. It trades about -0.05 of its total potential returns per unit of risk. Muyuan Foodstuff Co is currently generating about -0.01 per unit of volatility. If you would invest 4,768 in Muyuan Foodstuff Co on September 5, 2024 and sell it today you would lose (675.00) from holding Muyuan Foodstuff Co or give up 14.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Vanke Co vs. Muyuan Foodstuff Co
Performance |
| Timeline |
| China Vanke |
| Muyuan Foodstuff |
China Vanke and Muyuan Foodstuff Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Vanke and Muyuan Foodstuff
The main advantage of trading using opposite China Vanke and Muyuan Foodstuff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Vanke position performs unexpectedly, Muyuan Foodstuff 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 Muyuan Foodstuff will offset losses from the drop in Muyuan Foodstuff's long position.| China Vanke vs. Nanjing Putian Telecommunications | China Vanke vs. Tianjin Realty Development | China Vanke vs. Shenyang Huitian Thermal | China Vanke vs. Shenzhen Changfang Light |
| Muyuan Foodstuff vs. Poly Real Estate | Muyuan Foodstuff vs. China Vanke Co | Muyuan Foodstuff vs. China Merchants Shekou | Muyuan Foodstuff vs. Huafa Industrial Co |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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