Correlation Between Industrial Bank and Inspur Software
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By analyzing existing cross correlation between Industrial Bank Co and Inspur Software Co, you can compare the effects of market volatilities on Industrial Bank and Inspur Software 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 Inspur Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and Inspur Software.
Diversification Opportunities for Industrial Bank and Inspur Software
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Inspur is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank Co and Inspur Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspur Software 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 Inspur Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspur Software has no effect on the direction of Industrial Bank i.e., Industrial Bank and Inspur Software go up and down completely randomly.
Pair Corralation between Industrial Bank and Inspur Software
Assuming the 90 days trading horizon Industrial Bank is expected to generate 1.9 times less return on investment than Inspur Software. But when comparing it to its historical volatility, Industrial Bank Co is 2.09 times less risky than Inspur Software. It trades about 0.02 of its potential returns per unit of risk. Inspur Software Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,440 in Inspur Software Co on September 3, 2024 and sell it today you would earn a total of 109.00 from holding Inspur Software Co or generate 7.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Bank Co vs. Inspur Software Co
Performance |
| Timeline |
| Industrial Bank |
| Inspur Software |
Industrial Bank and Inspur Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and Inspur Software
The main advantage of trading using opposite Industrial Bank and Inspur Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, Inspur Software 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 Inspur Software will offset losses from the drop in Inspur Software's long position.| Industrial Bank vs. Chongqing Road Bridge | Industrial Bank vs. Wuhan Xianglong Power | Industrial Bank vs. Empyrean Technology Co | Industrial Bank vs. Yuanjie Semiconductor Technology |
| Inspur Software vs. Agricultural Bank of | Inspur Software vs. China Construction Bank | Inspur Software vs. Postal Savings Bank | Inspur Software vs. Bank of Communications |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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