Correlation Between China Baoan and Kangxin New
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By analyzing existing cross correlation between China Baoan Group and Kangxin New Materials, you can compare the effects of market volatilities on China Baoan and Kangxin New 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 Baoan with a short position of Kangxin New. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Baoan and Kangxin New.
Diversification Opportunities for China Baoan and Kangxin New
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Kangxin is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding China Baoan Group and Kangxin New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kangxin New Materials and China Baoan 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 Baoan Group are associated (or correlated) with Kangxin New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kangxin New Materials has no effect on the direction of China Baoan i.e., China Baoan and Kangxin New go up and down completely randomly.
Pair Corralation between China Baoan and Kangxin New
Assuming the 90 days trading horizon China Baoan Group is expected to generate 0.37 times more return on investment than Kangxin New. However, China Baoan Group is 2.72 times less risky than Kangxin New. It trades about -0.32 of its potential returns per unit of risk. Kangxin New Materials is currently generating about -0.13 per unit of risk. If you would invest 986.00 in China Baoan Group on October 30, 2024 and sell it today you would lose (155.00) from holding China Baoan Group or give up 15.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
China Baoan Group vs. Kangxin New Materials
Performance |
| Timeline |
| China Baoan Group |
| Kangxin New Materials |
China Baoan and Kangxin New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Baoan and Kangxin New
The main advantage of trading using opposite China Baoan and Kangxin New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Baoan position performs unexpectedly, Kangxin New 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 Kangxin New will offset losses from the drop in Kangxin New's long position.| China Baoan vs. Anhui Transport Consulting | China Baoan vs. East Money Information | China Baoan vs. Longjian Road Bridge | China Baoan vs. Invengo Information Technology |
| Kangxin New vs. Dazhong Transportation Group | Kangxin New vs. Nanning Chemical Industry | Kangxin New vs. Guangzhou Jointas Chemical | Kangxin New vs. Lander Sports Development |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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