Correlation Between China Asset and State Grid
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By analyzing existing cross correlation between China Asset Management and State Grid InformationCommunication, you can compare the effects of market volatilities on China Asset and State Grid 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 China Asset with a short position of State Grid. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Asset and State Grid.
Diversification Opportunities for China Asset and State Grid
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between China and State is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding China Asset Management and State Grid InformationCommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Grid Informati and China Asset 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 China Asset Management are associated (or correlated) with State Grid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Grid Informati has no effect on the direction of China Asset i.e., China Asset and State Grid go up and down completely randomly.
Pair Corralation between China Asset and State Grid
Assuming the 90 days trading horizon China Asset Management is expected to generate 0.43 times more return on investment than State Grid. However, China Asset Management is 2.31 times less risky than State Grid. It trades about 0.2 of its potential returns per unit of risk. State Grid InformationCommunication is currently generating about -0.12 per unit of risk. If you would invest 323.00 in China Asset Management on September 13, 2024 and sell it today you would earn a total of 18.00 from holding China Asset Management or generate 5.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Asset Management vs. State Grid InformationCommunic
Performance |
| Timeline |
| China Asset Management |
| State Grid Informati |
China Asset and State Grid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Asset and State Grid
The main advantage of trading using opposite China Asset and State Grid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Asset position performs unexpectedly, State Grid 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 State Grid will offset losses from the drop in State Grid's long position.| China Asset vs. Kweichow Moutai Co | China Asset vs. Agricultural Bank of | China Asset vs. China Mobile Limited | China Asset vs. China Construction Bank |
| State Grid vs. Jiangsu Yanghe Brewery | State Grid vs. Harbin Air Conditioning | State Grid vs. Eastern Air Logistics | State Grid vs. Tsingtao Brewery 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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