Correlation Between Chengdu B and China Construction
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By analyzing existing cross correlation between Chengdu B ray Media and China Construction Bank, you can compare the effects of market volatilities on Chengdu B 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 Chengdu B with a short position of China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu B and China Construction.
Diversification Opportunities for Chengdu B and China Construction
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chengdu and China is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu B ray Media 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 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 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 Chengdu B i.e., Chengdu B and China Construction go up and down completely randomly.
Pair Corralation between Chengdu B and China Construction
Assuming the 90 days trading horizon Chengdu B ray Media is expected to under-perform the China Construction. In addition to that, Chengdu B is 2.17 times more volatile than China Construction Bank. It trades about -0.01 of its total potential returns per unit of risk. China Construction Bank is currently generating about 0.06 per unit of volatility. If you would invest 624.00 in China Construction Bank on August 31, 2024 and sell it today you would earn a total of 174.00 from holding China Construction Bank or generate 27.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu B ray Media vs. China Construction Bank
Performance |
| Timeline |
| Chengdu B ray |
| China Construction Bank |
Chengdu B and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu B and China Construction
The main advantage of trading using opposite Chengdu B and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu B 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.| Chengdu B vs. BYD Co Ltd | Chengdu B vs. Agricultural Bank of | Chengdu B vs. Industrial and Commercial | Chengdu B vs. China State Construction |
| China Construction vs. Guangdong Jinming Machinery | China Construction vs. Postal Savings Bank | China Construction vs. Peoples Insurance of | China Construction vs. Allied Machinery 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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