Correlation Between Penyao Environmental and China Vanke
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By analyzing existing cross correlation between Penyao Environmental Protection and China Vanke Co, you can compare the effects of market volatilities on Penyao Environmental and China Vanke 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 Penyao Environmental with a short position of China Vanke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penyao Environmental and China Vanke.
Diversification Opportunities for Penyao Environmental and China Vanke
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Penyao and China is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Penyao Environmental Protectio and China Vanke Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Vanke and Penyao Environmental 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 Penyao Environmental Protection are associated (or correlated) with China Vanke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Vanke has no effect on the direction of Penyao Environmental i.e., Penyao Environmental and China Vanke go up and down completely randomly.
Pair Corralation between Penyao Environmental and China Vanke
Assuming the 90 days trading horizon Penyao Environmental Protection is expected to generate 0.94 times more return on investment than China Vanke. However, Penyao Environmental Protection is 1.06 times less risky than China Vanke. It trades about 0.03 of its potential returns per unit of risk. China Vanke Co is currently generating about -0.01 per unit of risk. If you would invest 536.00 in Penyao Environmental Protection on September 4, 2024 and sell it today you would earn a total of 62.00 from holding Penyao Environmental Protection or generate 11.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penyao Environmental Protectio vs. China Vanke Co
Performance |
| Timeline |
| Penyao Environmental |
| China Vanke |
Penyao Environmental and China Vanke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penyao Environmental and China Vanke
The main advantage of trading using opposite Penyao Environmental and China Vanke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penyao Environmental position performs unexpectedly, China Vanke 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 Vanke will offset losses from the drop in China Vanke's long position.| Penyao Environmental vs. Industrial and Commercial | Penyao Environmental vs. Agricultural Bank of | Penyao Environmental vs. China Construction Bank | Penyao Environmental vs. Bank of China |
| China Vanke vs. Jiajia Food Group | China Vanke vs. Ligao Foods CoLtd | China Vanke vs. Qijing Machinery | China Vanke vs. Anji Foodstuff 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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