Correlation Between China Union and Hua Xia
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By analyzing existing cross correlation between China Union Holdings and Hua Xia Bank, you can compare the effects of market volatilities on China Union and Hua Xia 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 Union with a short position of Hua Xia. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Union and Hua Xia.
Diversification Opportunities for China Union and Hua Xia
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Hua is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding China Union Holdings and Hua Xia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Xia Bank and China Union 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 Union Holdings are associated (or correlated) with Hua Xia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Xia Bank has no effect on the direction of China Union i.e., China Union and Hua Xia go up and down completely randomly.
Pair Corralation between China Union and Hua Xia
Assuming the 90 days trading horizon China Union Holdings is expected to under-perform the Hua Xia. In addition to that, China Union is 1.56 times more volatile than Hua Xia Bank. It trades about -0.67 of its total potential returns per unit of risk. Hua Xia Bank is currently generating about -0.16 per unit of volatility. If you would invest 778.00 in Hua Xia Bank on October 15, 2024 and sell it today you would lose (30.00) from holding Hua Xia Bank or give up 3.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Union Holdings vs. Hua Xia Bank
Performance |
| Timeline |
| China Union Holdings |
| Hua Xia Bank |
China Union and Hua Xia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Union and Hua Xia
The main advantage of trading using opposite China Union and Hua Xia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Union position performs unexpectedly, Hua Xia 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 Hua Xia will offset losses from the drop in Hua Xia's long position.| China Union vs. Hua Xia Bank | China Union vs. Postal Savings Bank | China Union vs. Unisplendour Corp | China Union vs. Bomesc Offshore Engineering |
| Hua Xia vs. Jiangsu Jinling Sports | Hua Xia vs. Shandong Rike Chemical | Hua Xia vs. Xiangtan Electrochemical Scientific | Hua Xia vs. Guizhou Chanhen Chemical |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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