Correlation Between Long Yuan and China Resources
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By analyzing existing cross correlation between Long Yuan Construction and China Resources Boya, you can compare the effects of market volatilities on Long Yuan and China Resources 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 Long Yuan with a short position of China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long Yuan and China Resources.
Diversification Opportunities for Long Yuan and China Resources
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Long and China is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Long Yuan Construction and China Resources Boya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Boya and Long Yuan 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 Long Yuan Construction are associated (or correlated) with China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Boya has no effect on the direction of Long Yuan i.e., Long Yuan and China Resources go up and down completely randomly.
Pair Corralation between Long Yuan and China Resources
Assuming the 90 days trading horizon Long Yuan Construction is expected to under-perform the China Resources. In addition to that, Long Yuan is 2.51 times more volatile than China Resources Boya. It trades about -0.28 of its total potential returns per unit of risk. China Resources Boya is currently generating about -0.19 per unit of volatility. If you would invest 3,096 in China Resources Boya on October 10, 2024 and sell it today you would lose (126.00) from holding China Resources Boya or give up 4.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Long Yuan Construction vs. China Resources Boya
Performance |
| Timeline |
| Long Yuan Construction |
| China Resources Boya |
Long Yuan and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long Yuan and China Resources
The main advantage of trading using opposite Long Yuan and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long Yuan position performs unexpectedly, China Resources 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 Resources will offset losses from the drop in China Resources' long position.| Long Yuan vs. ButOne Information Corp | Long Yuan vs. Dymatic Chemicals | Long Yuan vs. Dawning Information Industry | Long Yuan vs. Guizhou Chanhen Chemical |
| China Resources vs. Ming Yang Smart | China Resources vs. 159681 | China Resources vs. 159005 | China Resources vs. Loctek Ergonomic 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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