Correlation Between China Merchants and China Vanke
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By analyzing existing cross correlation between China Merchants Shekou and China Vanke Co, you can compare the effects of market volatilities on China Merchants and China Vanke 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 Merchants with a short position of China Vanke. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and China Vanke.
Diversification Opportunities for China Merchants and China Vanke
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and China is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and China Vanke Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Vanke and China Merchants 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 Merchants Shekou are associated (or correlated) with China Vanke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Vanke has no effect on the direction of China Merchants i.e., China Merchants and China Vanke go up and down completely randomly.
Pair Corralation between China Merchants and China Vanke
Assuming the 90 days trading horizon China Merchants Shekou is expected to generate 1.24 times more return on investment than China Vanke. However, China Merchants is 1.24 times more volatile than China Vanke Co. It trades about -0.07 of its potential returns per unit of risk. China Vanke Co is currently generating about -0.25 per unit of risk. If you would invest 1,116 in China Merchants Shekou on August 28, 2024 and sell it today you would lose (50.00) from holding China Merchants Shekou or give up 4.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. China Vanke Co
Performance |
| Timeline |
| China Merchants Shekou |
| China Vanke |
China Merchants and China Vanke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and China Vanke
The main advantage of trading using opposite China Merchants and China Vanke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, China Vanke 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 Vanke will offset losses from the drop in China Vanke's long position.| China Merchants vs. China Nonferrous Metal | China Merchants vs. Jinhe Biotechnology Co | China Merchants vs. Zhejiang Yayi Metal | China Merchants vs. Gansu Yasheng Industrial |
| China Vanke vs. Industrial and Commercial | China Vanke vs. China Construction Bank | China Vanke vs. Bank of China | China Vanke 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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