Correlation Between China Merchants and TianJin 712
Specify exactly 2 symbols:
By analyzing existing cross correlation between China Merchants Bank and TianJin 712 Communication, you can compare the effects of market volatilities on China Merchants and TianJin 712 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 Merchants with a short position of TianJin 712. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and TianJin 712.
Diversification Opportunities for China Merchants and TianJin 712
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and TianJin is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Bank and TianJin 712 Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TianJin 712 Communication and China Merchants 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 Merchants Bank are associated (or correlated) with TianJin 712. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TianJin 712 Communication has no effect on the direction of China Merchants i.e., China Merchants and TianJin 712 go up and down completely randomly.
Pair Corralation between China Merchants and TianJin 712
Assuming the 90 days trading horizon China Merchants Bank is expected to generate 0.3 times more return on investment than TianJin 712. However, China Merchants Bank is 3.35 times less risky than TianJin 712. It trades about 0.31 of its potential returns per unit of risk. TianJin 712 Communication is currently generating about -0.25 per unit of risk. If you would invest 3,802 in China Merchants Bank on October 20, 2024 and sell it today you would earn a total of 269.00 from holding China Merchants Bank or generate 7.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Bank vs. TianJin 712 Communication
Performance |
| Timeline |
| China Merchants Bank |
| TianJin 712 Communication |
China Merchants and TianJin 712 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and TianJin 712
The main advantage of trading using opposite China Merchants and TianJin 712 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, TianJin 712 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 TianJin 712 will offset losses from the drop in TianJin 712's long position.| China Merchants vs. Lingyuan Iron Steel | China Merchants vs. Panda Financial Holding | China Merchants vs. Sinocat Environmental Technology | China Merchants vs. Eit Environmental Development |
| TianJin 712 vs. Eastern Communications Co | TianJin 712 vs. Suzhou Douson Drilling | TianJin 712 vs. Guangxi Wuzhou Communications | TianJin 712 vs. Xinjiang Communications Construction |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |