Correlation Between Chengdu B and Bank of Communications
Specify exactly 2 symbols:
By analyzing existing cross correlation between Chengdu B ray Media and Bank of Communications, you can compare the effects of market volatilities on Chengdu B and Bank of Communications 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 Chengdu B with a short position of Bank of Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu B and Bank of Communications.
Diversification Opportunities for Chengdu B and Bank of Communications
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chengdu and Bank is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu B ray Media and Bank of Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Communications and Chengdu B 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 Chengdu B ray Media are associated (or correlated) with Bank of Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Communications has no effect on the direction of Chengdu B i.e., Chengdu B and Bank of Communications go up and down completely randomly.
Pair Corralation between Chengdu B and Bank of Communications
Assuming the 90 days trading horizon Chengdu B ray Media is expected to under-perform the Bank of Communications. In addition to that, Chengdu B is 2.25 times more volatile than Bank of Communications. It trades about 0.0 of its total potential returns per unit of risk. Bank of Communications is currently generating about 0.08 per unit of volatility. If you would invest 460.00 in Bank of Communications on November 9, 2024 and sell it today you would earn a total of 256.00 from holding Bank of Communications or generate 55.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu B ray Media vs. Bank of Communications
Performance |
| Timeline |
| Chengdu B ray |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Bank of Communications |
Risk-Adjusted Performance
Weak
Weak | Strong |
Chengdu B and Bank of Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu B and Bank of Communications
The main advantage of trading using opposite Chengdu B and Bank of Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu B position performs unexpectedly, Bank of Communications 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 Bank of Communications will offset losses from the drop in Bank of Communications' long position.The idea behind Chengdu B ray Media and Bank of Communications 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.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 Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |