Correlation Between Chinese Universe and China Railway
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By analyzing existing cross correlation between Chinese Universe Publishing and China Railway Group, you can compare the effects of market volatilities on Chinese Universe and China Railway 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 Chinese Universe with a short position of China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinese Universe and China Railway.
Diversification Opportunities for Chinese Universe and China Railway
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chinese and China is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Chinese Universe Publishing and China Railway Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Group and Chinese Universe 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 Chinese Universe Publishing are associated (or correlated) with China Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Group has no effect on the direction of Chinese Universe i.e., Chinese Universe and China Railway go up and down completely randomly.
Pair Corralation between Chinese Universe and China Railway
Assuming the 90 days trading horizon Chinese Universe Publishing is expected to under-perform the China Railway. But the stock apears to be less risky and, when comparing its historical volatility, Chinese Universe Publishing is 1.18 times less risky than China Railway. The stock trades about -0.14 of its potential returns per unit of risk. The China Railway Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 592.00 in China Railway Group on November 27, 2024 and sell it today you would earn a total of 4.00 from holding China Railway Group or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chinese Universe Publishing vs. China Railway Group
Performance |
| Timeline |
| Chinese Universe Pub |
| China Railway Group |
Chinese Universe and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chinese Universe and China Railway
The main advantage of trading using opposite Chinese Universe and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chinese Universe position performs unexpectedly, China Railway 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 China Railway will offset losses from the drop in China Railway's long position.| Chinese Universe vs. CIMC Vehicles Co | Chinese Universe vs. TongFu Microelectronics Co | Chinese Universe vs. YiDong Electronics Technology | Chinese Universe vs. Beijing Yanjing Brewery |
| China Railway vs. Shenwu Energy Saving | China Railway vs. Bank of Suzhou | China Railway vs. Suzhou Weizhixiang Food | China Railway vs. Zhongjing Food Co |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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