Correlation Between Chengdu Kanghua and China Marine
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By analyzing existing cross correlation between Chengdu Kanghua Biological and China Marine Information, you can compare the effects of market volatilities on Chengdu Kanghua and China Marine 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 Chengdu Kanghua with a short position of China Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and China Marine.
Diversification Opportunities for Chengdu Kanghua and China Marine
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chengdu and China is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and China Marine Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Marine Information and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with China Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Marine Information has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and China Marine go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and China Marine
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to generate 1.04 times more return on investment than China Marine. However, Chengdu Kanghua is 1.04 times more volatile than China Marine Information. It trades about -0.06 of its potential returns per unit of risk. China Marine Information is currently generating about -0.32 per unit of risk. If you would invest 6,038 in Chengdu Kanghua Biological on September 1, 2024 and sell it today you would lose (275.00) from holding Chengdu Kanghua Biological or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. China Marine Information
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| China Marine Information |
Chengdu Kanghua and China Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and China Marine
The main advantage of trading using opposite Chengdu Kanghua and China Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, China Marine 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 Marine will offset losses from the drop in China Marine's long position.| Chengdu Kanghua vs. Innovative Medical Management | Chengdu Kanghua vs. Tongyu Communication | Chengdu Kanghua vs. AVIC Fund Management | Chengdu Kanghua vs. Guangdong Shenglu Telecommunication |
| China Marine vs. Ming Yang Smart | China Marine vs. 159681 | China Marine vs. 159005 | China Marine 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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