Correlation Between Changchun High and Rongan Property
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By analyzing existing cross correlation between Changchun High New and Rongan Property Co, you can compare the effects of market volatilities on Changchun High and Rongan Property 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 Changchun High with a short position of Rongan Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun High and Rongan Property.
Diversification Opportunities for Changchun High and Rongan Property
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Changchun and Rongan is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Changchun High New and Rongan Property Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rongan Property and Changchun High 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 Changchun High New are associated (or correlated) with Rongan Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rongan Property has no effect on the direction of Changchun High i.e., Changchun High and Rongan Property go up and down completely randomly.
Pair Corralation between Changchun High and Rongan Property
Assuming the 90 days trading horizon Changchun High New is expected to generate 0.35 times more return on investment than Rongan Property. However, Changchun High New is 2.86 times less risky than Rongan Property. It trades about -0.2 of its potential returns per unit of risk. Rongan Property Co is currently generating about -0.2 per unit of risk. If you would invest 9,614 in Changchun High New on November 6, 2024 and sell it today you would lose (317.00) from holding Changchun High New or give up 3.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun High New vs. Rongan Property Co
Performance |
| Timeline |
| Changchun High New |
| Rongan Property |
Changchun High and Rongan Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun High and Rongan Property
The main advantage of trading using opposite Changchun High and Rongan Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun High position performs unexpectedly, Rongan Property 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 Rongan Property will offset losses from the drop in Rongan Property's long position.| Changchun High vs. Western Metal Materials | Changchun High vs. Wuhan Hvsen Biotechnology | Changchun High vs. Universal Scientific Industrial | Changchun High vs. Bosera CMSK Industrial |
| Rongan Property vs. Industrial and Commercial | Rongan Property vs. Agricultural Bank of | Rongan Property vs. China Construction Bank | Rongan Property vs. Bank of China |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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