Correlation Between Central Plains and Beijing SPC
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By analyzing existing cross correlation between Central Plains Environment and Beijing SPC Environment, you can compare the effects of market volatilities on Central Plains and Beijing SPC 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 Central Plains with a short position of Beijing SPC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Plains and Beijing SPC.
Diversification Opportunities for Central Plains and Beijing SPC
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Central and Beijing is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Central Plains Environment and Beijing SPC Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing SPC Environment and Central Plains 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 Central Plains Environment are associated (or correlated) with Beijing SPC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing SPC Environment has no effect on the direction of Central Plains i.e., Central Plains and Beijing SPC go up and down completely randomly.
Pair Corralation between Central Plains and Beijing SPC
Assuming the 90 days trading horizon Central Plains Environment is expected to generate 1.15 times more return on investment than Beijing SPC. However, Central Plains is 1.15 times more volatile than Beijing SPC Environment. It trades about 0.04 of its potential returns per unit of risk. Beijing SPC Environment is currently generating about -0.02 per unit of risk. If you would invest 706.00 in Central Plains Environment on September 1, 2024 and sell it today you would earn a total of 182.00 from holding Central Plains Environment or generate 25.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Plains Environment vs. Beijing SPC Environment
Performance |
| Timeline |
| Central Plains Envir |
| Beijing SPC Environment |
Central Plains and Beijing SPC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Plains and Beijing SPC
The main advantage of trading using opposite Central Plains and Beijing SPC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Plains position performs unexpectedly, Beijing SPC 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 Beijing SPC will offset losses from the drop in Beijing SPC's long position.| Central Plains vs. Sinomach Automobile Co | Central Plains vs. Guangdong Shenglu Telecommunication | Central Plains vs. CIMC Vehicles Co | Central Plains vs. Zhongtong Guomai Communication |
| Beijing SPC vs. New Hope Dairy | Beijing SPC vs. Shenzhen Topway Video | Beijing SPC vs. Zhengzhou Qianweiyangchu Food | Beijing SPC vs. Juewei Food 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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