Correlation Between Chongqing Road and Beijing Quanshi
Specify exactly 2 symbols:
By analyzing existing cross correlation between Chongqing Road Bridge and Beijing Quanshi World, you can compare the effects of market volatilities on Chongqing Road and Beijing Quanshi 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 Beijing Quanshi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Road and Beijing Quanshi.
Diversification Opportunities for Chongqing Road and Beijing Quanshi
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Beijing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Road Bridge and Beijing Quanshi World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Quanshi World 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 Beijing Quanshi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Quanshi World has no effect on the direction of Chongqing Road i.e., Chongqing Road and Beijing Quanshi go up and down completely randomly.
Pair Corralation between Chongqing Road and Beijing Quanshi
Assuming the 90 days trading horizon Chongqing Road Bridge is expected to generate 0.8 times more return on investment than Beijing Quanshi. However, Chongqing Road Bridge is 1.25 times less risky than Beijing Quanshi. It trades about 0.05 of its potential returns per unit of risk. Beijing Quanshi World is currently generating about 0.01 per unit of risk. If you would invest 488.00 in Chongqing Road Bridge on September 12, 2024 and sell it today you would earn a total of 235.00 from holding Chongqing Road Bridge or generate 48.16% 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. Beijing Quanshi World
Performance |
| Timeline |
| Chongqing Road Bridge |
| Beijing Quanshi World |
Chongqing Road and Beijing Quanshi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Road and Beijing Quanshi
The main advantage of trading using opposite Chongqing Road and Beijing Quanshi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Road position performs unexpectedly, Beijing Quanshi 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 Beijing Quanshi will offset losses from the drop in Beijing Quanshi's long position.The idea behind Chongqing Road Bridge and Beijing Quanshi World pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Beijing Quanshi vs. Maccura Biotechnology Co | Beijing Quanshi vs. Hunan Investment Group | Beijing Quanshi vs. Zoje Resources Investment | Beijing Quanshi vs. Shenzhen Centralcon Investment |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |