Correlation Between Shenzhen Mindray and China Life
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By analyzing existing cross correlation between Shenzhen Mindray Bio Medical and China Life Insurance, you can compare the effects of market volatilities on Shenzhen Mindray and China Life 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 Shenzhen Mindray with a short position of China Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Mindray and China Life.
Diversification Opportunities for Shenzhen Mindray and China Life
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and China is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Mindray Bio Medical and China Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Life Insurance and Shenzhen Mindray 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 Shenzhen Mindray Bio Medical are associated (or correlated) with China Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Life Insurance has no effect on the direction of Shenzhen Mindray i.e., Shenzhen Mindray and China Life go up and down completely randomly.
Pair Corralation between Shenzhen Mindray and China Life
Assuming the 90 days trading horizon Shenzhen Mindray Bio Medical is expected to under-perform the China Life. But the stock apears to be less risky and, when comparing its historical volatility, Shenzhen Mindray Bio Medical is 1.06 times less risky than China Life. The stock trades about -0.06 of its potential returns per unit of risk. The China Life Insurance is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,096 in China Life Insurance on September 26, 2024 and sell it today you would earn a total of 152.00 from holding China Life Insurance or generate 3.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Mindray Bio Medical vs. China Life Insurance
Performance |
| Timeline |
| Shenzhen Mindray Bio |
| China Life Insurance |
Shenzhen Mindray and China Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Mindray and China Life
The main advantage of trading using opposite Shenzhen Mindray and China Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Mindray position performs unexpectedly, China Life 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 Life will offset losses from the drop in China Life's long position.| Shenzhen Mindray vs. New China Life | Shenzhen Mindray vs. Ming Yang Smart | Shenzhen Mindray vs. 159681 | Shenzhen Mindray vs. 159005 |
| China Life vs. RoadMain T Co | China Life vs. Kontour Medical Technology | China Life vs. Beijing Wandong Medical | China Life vs. Shandong Hi Speed RoadBridge |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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