Correlation Between Blue Sail and China Enterprise
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By analyzing existing cross correlation between Blue Sail Medical and China Enterprise Co, you can compare the effects of market volatilities on Blue Sail and China Enterprise 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 Blue Sail with a short position of China Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Sail and China Enterprise.
Diversification Opportunities for Blue Sail and China Enterprise
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Blue and China is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Blue Sail Medical and China Enterprise Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Enterprise and Blue Sail 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 Blue Sail Medical are associated (or correlated) with China Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Enterprise has no effect on the direction of Blue Sail i.e., Blue Sail and China Enterprise go up and down completely randomly.
Pair Corralation between Blue Sail and China Enterprise
Assuming the 90 days trading horizon Blue Sail Medical is expected to under-perform the China Enterprise. But the stock apears to be less risky and, when comparing its historical volatility, Blue Sail Medical is 1.78 times less risky than China Enterprise. The stock trades about -0.14 of its potential returns per unit of risk. The China Enterprise Co is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 296.00 in China Enterprise Co on September 28, 2024 and sell it today you would lose (11.00) from holding China Enterprise Co or give up 3.72% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Blue Sail Medical vs. China Enterprise Co
Performance |
Timeline |
Blue Sail Medical |
China Enterprise |
Blue Sail and China Enterprise Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Blue Sail and China Enterprise
The main advantage of trading using opposite Blue Sail and China Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Sail position performs unexpectedly, China Enterprise 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 Enterprise will offset losses from the drop in China Enterprise's long position.Blue Sail vs. Guangzhou Boji Medical | Blue Sail vs. Ningbo MedicalSystem Biotechnology | Blue Sail vs. Touchstone International Medical | Blue Sail vs. Easyhome New Retail |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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