Correlation Between Industrial Bank and Changchun
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By analyzing existing cross correlation between Industrial Bank Co and Changchun UP Optotech, you can compare the effects of market volatilities on Industrial Bank and Changchun 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 Industrial Bank with a short position of Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and Changchun.
Diversification Opportunities for Industrial Bank and Changchun
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Changchun is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank Co and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech and Industrial Bank 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 Industrial Bank Co are associated (or correlated) with Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of Industrial Bank i.e., Industrial Bank and Changchun go up and down completely randomly.
Pair Corralation between Industrial Bank and Changchun
Assuming the 90 days trading horizon Industrial Bank Co is expected to under-perform the Changchun. But the stock apears to be less risky and, when comparing its historical volatility, Industrial Bank Co is 3.99 times less risky than Changchun. The stock trades about -0.24 of its potential returns per unit of risk. The Changchun UP Optotech is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 3,581 in Changchun UP Optotech on August 25, 2024 and sell it today you would earn a total of 595.00 from holding Changchun UP Optotech or generate 16.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Industrial Bank Co vs. Changchun UP Optotech
Performance |
| Timeline |
| Industrial Bank |
| Changchun UP Optotech |
Industrial Bank and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and Changchun
The main advantage of trading using opposite Industrial Bank and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| Industrial Bank vs. Gan Yuan Foods | Industrial Bank vs. Jiangnan Mould Plastic | Industrial Bank vs. Malion New Materials | Industrial Bank vs. Fuda Alloy Materials |
| Changchun vs. Huatian Hotel Group | Changchun vs. BTG Hotels Group | Changchun vs. Nexchip Semiconductor Corp | Changchun vs. Jinling Hotel Corp |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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