Correlation Between Chongqing Road and Bank of Suzhou
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By analyzing existing cross correlation between Chongqing Road Bridge and Bank of Suzhou, you can compare the effects of market volatilities on Chongqing Road and Bank of Suzhou 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 Chongqing Road with a short position of Bank of Suzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Road and Bank of Suzhou.
Diversification Opportunities for Chongqing Road and Bank of Suzhou
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Bank is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Road Bridge and Bank of Suzhou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Suzhou and Chongqing Road 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 Chongqing Road Bridge are associated (or correlated) with Bank of Suzhou. 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 Suzhou has no effect on the direction of Chongqing Road i.e., Chongqing Road and Bank of Suzhou go up and down completely randomly.
Pair Corralation between Chongqing Road and Bank of Suzhou
Assuming the 90 days trading horizon Chongqing Road is expected to generate 5.13 times less return on investment than Bank of Suzhou. In addition to that, Chongqing Road is 2.53 times more volatile than Bank of Suzhou. It trades about 0.01 of its total potential returns per unit of risk. Bank of Suzhou is currently generating about 0.19 per unit of volatility. If you would invest 754.00 in Bank of Suzhou on September 3, 2024 and sell it today you would earn a total of 38.00 from holding Bank of Suzhou or generate 5.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Road Bridge vs. Bank of Suzhou
Performance |
| Timeline |
| Chongqing Road Bridge |
| Bank of Suzhou |
Chongqing Road and Bank of Suzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Road and Bank of Suzhou
The main advantage of trading using opposite Chongqing Road and Bank of Suzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Road position performs unexpectedly, Bank of Suzhou 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 Suzhou will offset losses from the drop in Bank of Suzhou's long position.| Chongqing Road vs. Jiahe Foods Industry | Chongqing Road vs. Xiwang Foodstuffs Co | Chongqing Road vs. Zhongshan Public Utilities | Chongqing Road vs. Jiajia Food Group |
| Bank of Suzhou vs. Chongqing Road Bridge | Bank of Suzhou vs. Wuhan Xianglong Power | Bank of Suzhou vs. Empyrean Technology Co | Bank of Suzhou vs. Yuanjie Semiconductor 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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