Correlation Between Liuzhou Chemical and China Construction
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By analyzing existing cross correlation between Liuzhou Chemical Industry and China Construction Bank, you can compare the effects of market volatilities on Liuzhou Chemical and China Construction 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 Liuzhou Chemical with a short position of China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liuzhou Chemical and China Construction.
Diversification Opportunities for Liuzhou Chemical and China Construction
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Liuzhou and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Liuzhou Chemical Industry and China Construction Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Construction Bank and Liuzhou Chemical 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 Liuzhou Chemical Industry are associated (or correlated) with China Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Construction Bank has no effect on the direction of Liuzhou Chemical i.e., Liuzhou Chemical and China Construction go up and down completely randomly.
Pair Corralation between Liuzhou Chemical and China Construction
Assuming the 90 days trading horizon Liuzhou Chemical is expected to generate 12.31 times less return on investment than China Construction. In addition to that, Liuzhou Chemical is 2.0 times more volatile than China Construction Bank. It trades about 0.0 of its total potential returns per unit of risk. China Construction Bank is currently generating about 0.08 per unit of volatility. If you would invest 529.00 in China Construction Bank on October 16, 2024 and sell it today you would earn a total of 300.00 from holding China Construction Bank or generate 56.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liuzhou Chemical Industry vs. China Construction Bank
Performance |
| Timeline |
| Liuzhou Chemical Industry |
| China Construction Bank |
Liuzhou Chemical and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liuzhou Chemical and China Construction
The main advantage of trading using opposite Liuzhou Chemical and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liuzhou Chemical position performs unexpectedly, China Construction 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 Construction will offset losses from the drop in China Construction's long position.| Liuzhou Chemical vs. Zijin Mining Group | Liuzhou Chemical vs. Wanhua Chemical Group | Liuzhou Chemical vs. Baoshan Iron Steel | Liuzhou Chemical vs. Shandong Gold Mining |
| China Construction vs. Jilin Chemical Fibre | China Construction vs. Liuzhou Chemical Industry | China Construction vs. Hainan Haiqi Transportation | China Construction vs. Longxing Chemical Stock |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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