Correlation Between 159681 and China Railway
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By analyzing existing cross correlation between 159681 and China Railway Construction, you can compare the effects of market volatilities on 159681 and China Railway 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 Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159681 and China Railway.
Diversification Opportunities for 159681 and China Railway
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 159681 and China is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding 159681 and China Railway Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Constr 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 Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Constr has no effect on the direction of 159681 i.e., 159681 and China Railway go up and down completely randomly.
Pair Corralation between 159681 and China Railway
Assuming the 90 days trading horizon 159681 is expected to generate 6.32 times less return on investment than China Railway. In addition to that, 159681 is 1.05 times more volatile than China Railway Construction. It trades about 0.0 of its total potential returns per unit of risk. China Railway Construction is currently generating about 0.03 per unit of volatility. If you would invest 758.00 in China Railway Construction on September 28, 2024 and sell it today you would earn a total of 172.00 from holding China Railway Construction or generate 22.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
159681 vs. China Railway Construction
Performance |
| Timeline |
| 159681 |
| China Railway Constr |
159681 and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159681 and China Railway
The main advantage of trading using opposite 159681 and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159681 position performs unexpectedly, China Railway 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 Railway will offset losses from the drop in China Railway's long position.The idea behind 159681 and China Railway Construction 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 Railway vs. Ming Yang Smart | China Railway vs. 159681 | China Railway vs. 159005 | China Railway vs. Loctek Ergonomic 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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