Correlation Between Cultural Investment and China Publishing
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By analyzing existing cross correlation between Cultural Investment Holdings and China Publishing Media, you can compare the effects of market volatilities on Cultural Investment and China Publishing 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 Cultural Investment with a short position of China Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cultural Investment and China Publishing.
Diversification Opportunities for Cultural Investment and China Publishing
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cultural and China is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Cultural Investment Holdings and China Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Publishing Media and Cultural Investment 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 Cultural Investment Holdings are associated (or correlated) with China Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Publishing Media has no effect on the direction of Cultural Investment i.e., Cultural Investment and China Publishing go up and down completely randomly.
Pair Corralation between Cultural Investment and China Publishing
Assuming the 90 days trading horizon Cultural Investment is expected to generate 1.75 times less return on investment than China Publishing. But when comparing it to its historical volatility, Cultural Investment Holdings is 1.11 times less risky than China Publishing. It trades about 0.07 of its potential returns per unit of risk. China Publishing Media is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 678.00 in China Publishing Media on November 5, 2024 and sell it today you would earn a total of 18.00 from holding China Publishing Media or generate 2.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cultural Investment Holdings vs. China Publishing Media
Performance |
| Timeline |
| Cultural Investment |
| China Publishing Media |
Cultural Investment and China Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cultural Investment and China Publishing
The main advantage of trading using opposite Cultural Investment and China Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cultural Investment position performs unexpectedly, China Publishing 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 Publishing will offset losses from the drop in China Publishing's long position.The idea behind Cultural Investment Holdings and China Publishing Media 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.
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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