Correlation Between China Securities and Chongqing Changan
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By analyzing existing cross correlation between China Securities 800 and Chongqing Changan Automobile, you can compare the effects of market volatilities on China Securities and Chongqing Changan 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 Securities with a short position of Chongqing Changan. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Chongqing Changan.
Diversification Opportunities for China Securities and Chongqing Changan
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Chongqing is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Chongqing Changan Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Changan and China Securities 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 Securities 800 are associated (or correlated) with Chongqing Changan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Changan has no effect on the direction of China Securities i.e., China Securities and Chongqing Changan go up and down completely randomly.
Pair Corralation between China Securities and Chongqing Changan
Assuming the 90 days trading horizon China Securities is expected to generate 6.91 times less return on investment than Chongqing Changan. But when comparing it to its historical volatility, China Securities 800 is 1.21 times less risky than Chongqing Changan. It trades about 0.01 of its potential returns per unit of risk. Chongqing Changan Automobile is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 350.00 in Chongqing Changan Automobile on September 1, 2024 and sell it today you would earn a total of 11.00 from holding Chongqing Changan Automobile or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Chongqing Changan Automobile
Performance |
| Timeline |
China Securities and Chongqing Changan Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Chongqing Changan Automobile
Pair trading matchups for Chongqing Changan
Pair Trading with China Securities and Chongqing Changan
The main advantage of trading using opposite China Securities and Chongqing Changan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Chongqing Changan 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 Chongqing Changan will offset losses from the drop in Chongqing Changan's long position.| China Securities vs. Everjoy Health Group | China Securities vs. Fuzhou Rockchip Electronics | China Securities vs. Hangzhou Prevail Optoelectronic | China Securities vs. Aurora Optoelectronics Co |
| Chongqing Changan vs. Western Metal Materials | Chongqing Changan vs. China Minmetals Rare | Chongqing Changan vs. Miracll Chemicals Co | Chongqing Changan vs. Xiangtan Electrochemical Scientific |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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