Correlation Between China World and Industrial
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By analyzing existing cross correlation between China World Trade and Industrial and Commercial, you can compare the effects of market volatilities on China World and Industrial 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 World with a short position of Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of China World and Industrial.
Diversification Opportunities for China World and Industrial
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Industrial is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding China World Trade and Industrial and Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial and Commercial and China World 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 World Trade are associated (or correlated) with Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial and Commercial has no effect on the direction of China World i.e., China World and Industrial go up and down completely randomly.
Pair Corralation between China World and Industrial
Assuming the 90 days trading horizon China World Trade is expected to under-perform the Industrial. In addition to that, China World is 1.37 times more volatile than Industrial and Commercial. It trades about -0.19 of its total potential returns per unit of risk. Industrial and Commercial is currently generating about 0.07 per unit of volatility. If you would invest 607.00 in Industrial and Commercial on August 29, 2024 and sell it today you would earn a total of 9.00 from holding Industrial and Commercial or generate 1.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China World Trade vs. Industrial and Commercial
Performance |
| Timeline |
| China World Trade |
| Industrial and Commercial |
China World and Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China World and Industrial
The main advantage of trading using opposite China World and Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China World position performs unexpectedly, Industrial 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 Industrial will offset losses from the drop in Industrial's long position.| China World vs. Industrial and Commercial | China World vs. China Construction Bank | China World vs. Bank of China | China World vs. Agricultural Bank of |
| Industrial vs. Allwin Telecommunication Co | Industrial vs. SUNSEA Telecommunications Co | Industrial vs. Guangzhou Haige Communications | Industrial vs. Nanjing Putian Telecommunications |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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