Correlation Between Bank of Suzhou and Chongqing Changan
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By analyzing existing cross correlation between Bank of Suzhou and Chongqing Changan Automobile, you can compare the effects of market volatilities on Bank of Suzhou 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 Bank of Suzhou with a short position of Chongqing Changan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Suzhou and Chongqing Changan.
Diversification Opportunities for Bank of Suzhou and Chongqing Changan
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Chongqing is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Suzhou and Chongqing Changan Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Changan and Bank of Suzhou 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 Bank of Suzhou 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 Bank of Suzhou i.e., Bank of Suzhou and Chongqing Changan go up and down completely randomly.
Pair Corralation between Bank of Suzhou and Chongqing Changan
Assuming the 90 days trading horizon Bank of Suzhou is expected to generate 1.16 times more return on investment than Chongqing Changan. However, Bank of Suzhou is 1.16 times more volatile than Chongqing Changan Automobile. It trades about 0.02 of its potential returns per unit of risk. Chongqing Changan Automobile is currently generating about -0.13 per unit of risk. If you would invest 790.00 in Bank of Suzhou on November 3, 2024 and sell it today you would earn a total of 3.00 from holding Bank of Suzhou or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Suzhou vs. Chongqing Changan Automobile
Performance |
| Timeline |
| Bank of Suzhou |
| Chongqing Changan |
Bank of Suzhou and Chongqing Changan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Suzhou and Chongqing Changan
The main advantage of trading using opposite Bank of Suzhou and Chongqing Changan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Suzhou 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.| Bank of Suzhou vs. Zhangjiagang Freetrade Science | Bank of Suzhou vs. APT Medical | Bank of Suzhou vs. Hengkang Medical Group | Bank of Suzhou vs. Zhejiang Yongjin Metal |
| Chongqing Changan vs. Shandong Intco Medical | Chongqing Changan vs. Huizhou Speed Wireless | Chongqing Changan vs. Fiberhome Telecommunication Technologies | Chongqing Changan vs. Kontour Medical Technology |
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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