Correlation Between Beijing SPC and Eit Environmental
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By analyzing existing cross correlation between Beijing SPC Environment and Eit Environmental Development, you can compare the effects of market volatilities on Beijing SPC and Eit Environmental 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 SPC with a short position of Eit Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing SPC and Eit Environmental.
Diversification Opportunities for Beijing SPC and Eit Environmental
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and Eit is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Beijing SPC Environment and Eit Environmental Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eit Environmental and Beijing SPC 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 SPC Environment are associated (or correlated) with Eit Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eit Environmental has no effect on the direction of Beijing SPC i.e., Beijing SPC and Eit Environmental go up and down completely randomly.
Pair Corralation between Beijing SPC and Eit Environmental
Assuming the 90 days trading horizon Beijing SPC Environment is expected to under-perform the Eit Environmental. But the stock apears to be less risky and, when comparing its historical volatility, Beijing SPC Environment is 1.51 times less risky than Eit Environmental. The stock trades about -0.03 of its potential returns per unit of risk. The Eit Environmental Development is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,269 in Eit Environmental Development on August 30, 2024 and sell it today you would earn a total of 279.00 from holding Eit Environmental Development or generate 21.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing SPC Environment vs. Eit Environmental Development
Performance |
| Timeline |
| Beijing SPC Environment |
| Eit Environmental |
Beijing SPC and Eit Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing SPC and Eit Environmental
The main advantage of trading using opposite Beijing SPC and Eit Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing SPC position performs unexpectedly, Eit Environmental 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 Eit Environmental will offset losses from the drop in Eit Environmental's long position.| Beijing SPC vs. PetroChina Co Ltd | Beijing SPC vs. China State Construction | Beijing SPC vs. China Mobile Limited | Beijing SPC vs. Industrial and Commercial |
| Eit Environmental vs. PetroChina Co Ltd | Eit Environmental vs. China State Construction | Eit Environmental vs. China Mobile Limited | Eit Environmental vs. Industrial and Commercial |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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