Correlation Between Kangxin New and Bank of Communications
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By analyzing existing cross correlation between Kangxin New Materials and Bank of Communications, you can compare the effects of market volatilities on Kangxin New and Bank of Communications 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 Kangxin New with a short position of Bank of Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kangxin New and Bank of Communications.
Diversification Opportunities for Kangxin New and Bank of Communications
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kangxin and Bank is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Kangxin New Materials and Bank of Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Communications and Kangxin New 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 Kangxin New Materials are associated (or correlated) with Bank of Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Communications has no effect on the direction of Kangxin New i.e., Kangxin New and Bank of Communications go up and down completely randomly.
Pair Corralation between Kangxin New and Bank of Communications
Assuming the 90 days trading horizon Kangxin New Materials is expected to under-perform the Bank of Communications. In addition to that, Kangxin New is 2.01 times more volatile than Bank of Communications. It trades about -0.31 of its total potential returns per unit of risk. Bank of Communications is currently generating about -0.22 per unit of volatility. If you would invest 768.00 in Bank of Communications on October 22, 2024 and sell it today you would lose (40.00) from holding Bank of Communications or give up 5.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kangxin New Materials vs. Bank of Communications
Performance |
| Timeline |
| Kangxin New Materials |
| Bank of Communications |
Kangxin New and Bank of Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kangxin New and Bank of Communications
The main advantage of trading using opposite Kangxin New and Bank of Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kangxin New position performs unexpectedly, Bank of Communications 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 Bank of Communications will offset losses from the drop in Bank of Communications' long position.| Kangxin New vs. UE Furniture Co | Kangxin New vs. Qumei Furniture Group | Kangxin New vs. Rising Nonferrous Metals | Kangxin New vs. Luolai Home Textile |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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