Correlation Between Beijing Yanjing and China World
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By analyzing existing cross correlation between Beijing Yanjing Brewery and China World Trade, you can compare the effects of market volatilities on Beijing Yanjing and China World 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 Beijing Yanjing with a short position of China World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Yanjing and China World.
Diversification Opportunities for Beijing Yanjing and China World
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Beijing and China is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Yanjing Brewery and China World Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China World Trade and Beijing Yanjing 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 Beijing Yanjing Brewery are associated (or correlated) with China World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China World Trade has no effect on the direction of Beijing Yanjing i.e., Beijing Yanjing and China World go up and down completely randomly.
Pair Corralation between Beijing Yanjing and China World
Assuming the 90 days trading horizon Beijing Yanjing Brewery is expected to generate 1.32 times more return on investment than China World. However, Beijing Yanjing is 1.32 times more volatile than China World Trade. It trades about -0.09 of its potential returns per unit of risk. China World Trade is currently generating about -0.21 per unit of risk. If you would invest 1,046 in Beijing Yanjing Brewery on August 28, 2024 and sell it today you would lose (39.00) from holding Beijing Yanjing Brewery or give up 3.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Yanjing Brewery vs. China World Trade
Performance |
| Timeline |
| Beijing Yanjing Brewery |
| China World Trade |
Beijing Yanjing and China World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Yanjing and China World
The main advantage of trading using opposite Beijing Yanjing and China World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Yanjing position performs unexpectedly, China World 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 China World will offset losses from the drop in China World's long position.| Beijing Yanjing vs. China Petroleum Chemical | Beijing Yanjing vs. PetroChina Co Ltd | Beijing Yanjing vs. China State Construction | Beijing Yanjing vs. China Railway Group |
| China World vs. Industrial and Commercial | China World vs. China Construction Bank | China World vs. Bank of China | China World vs. Agricultural Bank of |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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