Correlation Between China Express and Tsingtao Brewery
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By analyzing existing cross correlation between China Express Airlines and Tsingtao Brewery Co, you can compare the effects of market volatilities on China Express and Tsingtao Brewery 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 Express with a short position of Tsingtao Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Express and Tsingtao Brewery.
Diversification Opportunities for China Express and Tsingtao Brewery
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Tsingtao is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding China Express Airlines and Tsingtao Brewery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsingtao Brewery and China Express 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 Express Airlines are associated (or correlated) with Tsingtao Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsingtao Brewery has no effect on the direction of China Express i.e., China Express and Tsingtao Brewery go up and down completely randomly.
Pair Corralation between China Express and Tsingtao Brewery
Assuming the 90 days trading horizon China Express Airlines is expected to under-perform the Tsingtao Brewery. In addition to that, China Express is 1.08 times more volatile than Tsingtao Brewery Co. It trades about -0.17 of its total potential returns per unit of risk. Tsingtao Brewery Co is currently generating about -0.03 per unit of volatility. If you would invest 7,510 in Tsingtao Brewery Co on September 12, 2024 and sell it today you would lose (90.00) from holding Tsingtao Brewery Co or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Express Airlines vs. Tsingtao Brewery Co
Performance |
| Timeline |
| China Express Airlines |
| Tsingtao Brewery |
China Express and Tsingtao Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Express and Tsingtao Brewery
The main advantage of trading using opposite China Express and Tsingtao Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Express position performs unexpectedly, Tsingtao Brewery 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 Tsingtao Brewery will offset losses from the drop in Tsingtao Brewery's long position.| China Express vs. Agricultural Bank of | China Express vs. Industrial and Commercial | China Express vs. Bank of China | China Express vs. PetroChina Co Ltd |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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