Correlation Between Qingdao Choho and Beijing Zhong
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By analyzing existing cross correlation between Qingdao Choho Industrial and Beijing Zhong Ke, you can compare the effects of market volatilities on Qingdao Choho and Beijing Zhong 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 Qingdao Choho with a short position of Beijing Zhong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Choho and Beijing Zhong.
Diversification Opportunities for Qingdao Choho and Beijing Zhong
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Qingdao and Beijing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Choho Industrial and Beijing Zhong Ke in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Zhong Ke and Qingdao Choho 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 Qingdao Choho Industrial are associated (or correlated) with Beijing Zhong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Zhong Ke has no effect on the direction of Qingdao Choho i.e., Qingdao Choho and Beijing Zhong go up and down completely randomly.
Pair Corralation between Qingdao Choho and Beijing Zhong
Assuming the 90 days trading horizon Qingdao Choho Industrial is expected to generate 1.56 times more return on investment than Beijing Zhong. However, Qingdao Choho is 1.56 times more volatile than Beijing Zhong Ke. It trades about 0.11 of its potential returns per unit of risk. Beijing Zhong Ke is currently generating about -0.14 per unit of risk. If you would invest 2,766 in Qingdao Choho Industrial on September 14, 2024 and sell it today you would earn a total of 176.00 from holding Qingdao Choho Industrial or generate 6.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Choho Industrial vs. Beijing Zhong Ke
Performance |
| Timeline |
| Qingdao Choho Industrial |
| Beijing Zhong Ke |
Qingdao Choho and Beijing Zhong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Choho and Beijing Zhong
The main advantage of trading using opposite Qingdao Choho and Beijing Zhong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Choho position performs unexpectedly, Beijing Zhong 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 Beijing Zhong will offset losses from the drop in Beijing Zhong's long position.| Qingdao Choho vs. BeiGene | Qingdao Choho vs. Kweichow Moutai Co | Qingdao Choho vs. Beijing Roborock Technology | Qingdao Choho vs. G bits Network Technology |
| Beijing Zhong vs. Industrial and Commercial | Beijing Zhong vs. Agricultural Bank of | Beijing Zhong vs. China Construction Bank | Beijing Zhong vs. Bank of China |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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