Correlation Between 159681 and China Reform
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By analyzing existing cross correlation between 159681 and China Reform Health, you can compare the effects of market volatilities on 159681 and China Reform 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 159681 with a short position of China Reform. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159681 and China Reform.
Diversification Opportunities for 159681 and China Reform
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 159681 and China is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding 159681 and China Reform Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Reform Health and 159681 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 159681 are associated (or correlated) with China Reform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Reform Health has no effect on the direction of 159681 i.e., 159681 and China Reform go up and down completely randomly.
Pair Corralation between 159681 and China Reform
Assuming the 90 days trading horizon 159681 is expected to generate 1.94 times less return on investment than China Reform. But when comparing it to its historical volatility, 159681 is 1.91 times less risky than China Reform. It trades about 0.14 of its potential returns per unit of risk. China Reform Health is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,012 in China Reform Health on December 11, 2024 and sell it today you would earn a total of 175.00 from holding China Reform Health or generate 17.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
159681 vs. China Reform Health
Performance |
| Timeline |
| 159681 |
| China Reform Health |
159681 and China Reform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159681 and China Reform
The main advantage of trading using opposite 159681 and China Reform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159681 position performs unexpectedly, China Reform 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 Reform will offset losses from the drop in China Reform's long position.The idea behind 159681 and China Reform Health pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| China Reform vs. Advanced Technology Materials | China Reform vs. Shanghai Rongtai Health | China Reform vs. Everjoy Health Group | China Reform vs. Healthcare Co |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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