Correlation Between Beijing New and Cultural Investment
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By analyzing existing cross correlation between Beijing New Building and Cultural Investment Holdings, you can compare the effects of market volatilities on Beijing New and Cultural Investment 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 New with a short position of Cultural Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing New and Cultural Investment.
Diversification Opportunities for Beijing New and Cultural Investment
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijing and Cultural is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Beijing New Building and Cultural Investment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cultural Investment and Beijing New 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 New Building are associated (or correlated) with Cultural Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cultural Investment has no effect on the direction of Beijing New i.e., Beijing New and Cultural Investment go up and down completely randomly.
Pair Corralation between Beijing New and Cultural Investment
Assuming the 90 days trading horizon Beijing New is expected to generate 1.1 times less return on investment than Cultural Investment. But when comparing it to its historical volatility, Beijing New Building is 1.74 times less risky than Cultural Investment. It trades about 0.02 of its potential returns per unit of risk. Cultural Investment Holdings is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 244.00 in Cultural Investment Holdings on September 4, 2024 and sell it today you would lose (16.00) from holding Cultural Investment Holdings or give up 6.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing New Building vs. Cultural Investment Holdings
Performance |
| Timeline |
| Beijing New Building |
| Cultural Investment |
Beijing New and Cultural Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing New and Cultural Investment
The main advantage of trading using opposite Beijing New and Cultural Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing New position performs unexpectedly, Cultural Investment 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 Cultural Investment will offset losses from the drop in Cultural Investment's long position.| Beijing New vs. Railway Signal Communication | Beijing New vs. Anhui Jianghuai Automobile | Beijing New vs. Runjian Communication Co | Beijing New vs. ButOne Information Corp |
| Cultural Investment vs. China State Construction | Cultural Investment vs. Poly Real Estate | Cultural Investment vs. China Vanke Co | Cultural Investment vs. China Merchants Shekou |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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