Correlation Between China Reform and Sinotrans
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By analyzing existing cross correlation between China Reform Health and Sinotrans Ltd Class, you can compare the effects of market volatilities on China Reform and Sinotrans 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 Reform with a short position of Sinotrans. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Reform and Sinotrans.
Diversification Opportunities for China Reform and Sinotrans
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Sinotrans is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding China Reform Health and Sinotrans Ltd Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinotrans Class and China Reform 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 Reform Health are associated (or correlated) with Sinotrans. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinotrans Class has no effect on the direction of China Reform i.e., China Reform and Sinotrans go up and down completely randomly.
Pair Corralation between China Reform and Sinotrans
Assuming the 90 days trading horizon China Reform is expected to generate 2.01 times less return on investment than Sinotrans. In addition to that, China Reform is 1.51 times more volatile than Sinotrans Ltd Class. It trades about 0.01 of its total potential returns per unit of risk. Sinotrans Ltd Class is currently generating about 0.04 per unit of volatility. If you would invest 390.00 in Sinotrans Ltd Class on October 16, 2024 and sell it today you would earn a total of 119.00 from holding Sinotrans Ltd Class or generate 30.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Reform Health vs. Sinotrans Ltd Class
Performance |
| Timeline |
| China Reform Health |
| Sinotrans Class |
China Reform and Sinotrans Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Reform and Sinotrans
The main advantage of trading using opposite China Reform and Sinotrans positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Reform position performs unexpectedly, Sinotrans 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 Sinotrans will offset losses from the drop in Sinotrans' long position.| China Reform vs. Wuhan Yangtze Communication | China Reform vs. Guangzhou Haige Communications | China Reform vs. Guangxi Wuzhou Communications | China Reform vs. Zhejiang Kingland Pipeline |
| Sinotrans vs. Shandong Sinoglory Health | Sinotrans vs. China Reform Health | Sinotrans vs. Xiangyang Automobile Bearing | Sinotrans vs. Healthcare 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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