Correlation Between Cinda Securities and PharmaResources
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By analyzing existing cross correlation between Cinda Securities Co and PharmaResources Co Ltd, you can compare the effects of market volatilities on Cinda Securities and PharmaResources 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 Cinda Securities with a short position of PharmaResources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cinda Securities and PharmaResources.
Diversification Opportunities for Cinda Securities and PharmaResources
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cinda and PharmaResources is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Cinda Securities Co and PharmaResources Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PharmaResources and Cinda Securities 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 Cinda Securities Co are associated (or correlated) with PharmaResources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PharmaResources has no effect on the direction of Cinda Securities i.e., Cinda Securities and PharmaResources go up and down completely randomly.
Pair Corralation between Cinda Securities and PharmaResources
Assuming the 90 days trading horizon Cinda Securities Co is expected to under-perform the PharmaResources. But the stock apears to be less risky and, when comparing its historical volatility, Cinda Securities Co is 1.38 times less risky than PharmaResources. The stock trades about -0.04 of its potential returns per unit of risk. The PharmaResources Co Ltd is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,526 in PharmaResources Co Ltd on September 20, 2024 and sell it today you would earn a total of 209.00 from holding PharmaResources Co Ltd or generate 8.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Cinda Securities Co vs. PharmaResources Co Ltd
Performance |
Timeline |
Cinda Securities |
PharmaResources |
Cinda Securities and PharmaResources Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cinda Securities and PharmaResources
The main advantage of trading using opposite Cinda Securities and PharmaResources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cinda Securities position performs unexpectedly, PharmaResources 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 PharmaResources will offset losses from the drop in PharmaResources' long position.Cinda Securities vs. Zhejiang Huatong Meat | Cinda Securities vs. Chengdu Spaceon Electronics | Cinda Securities vs. Heilongjiang Publishing Media | Cinda Securities vs. JCHX Mining Management |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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