Correlation Between State Grid and BCEG Environmental
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By analyzing existing cross correlation between State Grid InformationCommunication and BCEG Environmental Remediation, you can compare the effects of market volatilities on State Grid and BCEG Environmental 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 State Grid with a short position of BCEG Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Grid and BCEG Environmental.
Diversification Opportunities for State Grid and BCEG Environmental
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between State and BCEG is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding State Grid InformationCommunic and BCEG Environmental Remediation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCEG Environmental and State Grid 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 State Grid InformationCommunication are associated (or correlated) with BCEG Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCEG Environmental has no effect on the direction of State Grid i.e., State Grid and BCEG Environmental go up and down completely randomly.
Pair Corralation between State Grid and BCEG Environmental
Assuming the 90 days trading horizon State Grid InformationCommunication is expected to generate 1.04 times more return on investment than BCEG Environmental. However, State Grid is 1.04 times more volatile than BCEG Environmental Remediation. It trades about 0.06 of its potential returns per unit of risk. BCEG Environmental Remediation is currently generating about 0.02 per unit of risk. If you would invest 1,823 in State Grid InformationCommunication on September 3, 2024 and sell it today you would earn a total of 399.00 from holding State Grid InformationCommunication or generate 21.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Grid InformationCommunic vs. BCEG Environmental Remediation
Performance |
| Timeline |
| State Grid Informati |
| BCEG Environmental |
State Grid and BCEG Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Grid and BCEG Environmental
The main advantage of trading using opposite State Grid and BCEG Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Grid position performs unexpectedly, BCEG Environmental 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 BCEG Environmental will offset losses from the drop in BCEG Environmental's long position.| State Grid vs. Guangdong Jingyi Metal | State Grid vs. Ye Chiu Metal | State Grid vs. Qinghaihuading Industrial Co | State Grid vs. Qijing Machinery |
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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