Correlation Between King Strong and China Railway
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By analyzing existing cross correlation between King Strong New Material and China Railway Construction, you can compare the effects of market volatilities on King Strong 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 King Strong with a short position of China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of King Strong and China Railway.
Diversification Opportunities for King Strong and China Railway
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between King and China is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding King Strong New Material 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 King Strong 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 King Strong New Material 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 King Strong i.e., King Strong and China Railway go up and down completely randomly.
Pair Corralation between King Strong and China Railway
Assuming the 90 days trading horizon King Strong New Material is expected to under-perform the China Railway. In addition to that, King Strong is 1.99 times more volatile than China Railway Construction. It trades about -0.21 of its total potential returns per unit of risk. China Railway Construction is currently generating about -0.33 per unit of volatility. If you would invest 932.00 in China Railway Construction on October 28, 2024 and sell it today you would lose (82.00) from holding China Railway Construction or give up 8.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
King Strong New Material vs. China Railway Construction
Performance |
| Timeline |
| King Strong New |
| China Railway Constr |
King Strong and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with King Strong and China Railway
The main advantage of trading using opposite King Strong and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if King Strong 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.| King Strong vs. Industrial and Commercial | King Strong vs. China Construction Bank | King Strong vs. Agricultural Bank of | King Strong vs. Bank of China |
| China Railway vs. Industrial and Commercial | China Railway vs. China Construction Bank | China Railway vs. Agricultural Bank of | China Railway 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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