Correlation Between Chengdu B and Eastern Communications
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By analyzing existing cross correlation between Chengdu B ray Media and Eastern Communications Co, you can compare the effects of market volatilities on Chengdu B and Eastern 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 Eastern Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu B and Eastern Communications.
Diversification Opportunities for Chengdu B and Eastern Communications
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chengdu and Eastern is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu B ray Media and Eastern Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern 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 Eastern Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Communications has no effect on the direction of Chengdu B i.e., Chengdu B and Eastern Communications go up and down completely randomly.
Pair Corralation between Chengdu B and Eastern Communications
Assuming the 90 days trading horizon Chengdu B ray Media is expected to generate 1.2 times more return on investment than Eastern Communications. However, Chengdu B is 1.2 times more volatile than Eastern Communications Co. It trades about 0.21 of its potential returns per unit of risk. Eastern Communications Co is currently generating about 0.22 per unit of risk. If you would invest 359.00 in Chengdu B ray Media on September 12, 2024 and sell it today you would earn a total of 161.00 from holding Chengdu B ray Media or generate 44.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu B ray Media vs. Eastern Communications Co
Performance |
| Timeline |
| Chengdu B ray |
| Eastern Communications |
Chengdu B and Eastern Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu B and Eastern Communications
The main advantage of trading using opposite Chengdu B and Eastern Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu B position performs unexpectedly, Eastern 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 Eastern Communications will offset losses from the drop in Eastern Communications' long position.| Chengdu B vs. Kweichow Moutai Co | Chengdu B vs. Shenzhen Mindray Bio Medical | Chengdu B vs. G bits Network Technology | Chengdu B vs. Beijing Roborock 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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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