Correlation Between Bank of Beijing and Xiamen Jihong
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By analyzing existing cross correlation between Bank of Beijing and Xiamen Jihong Package, you can compare the effects of market volatilities on Bank of Beijing and Xiamen Jihong 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 Bank of Beijing with a short position of Xiamen Jihong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Beijing and Xiamen Jihong.
Diversification Opportunities for Bank of Beijing and Xiamen Jihong
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Xiamen is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Beijing and Xiamen Jihong Package in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Jihong Package and Bank of Beijing 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 Bank of Beijing are associated (or correlated) with Xiamen Jihong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Jihong Package has no effect on the direction of Bank of Beijing i.e., Bank of Beijing and Xiamen Jihong go up and down completely randomly.
Pair Corralation between Bank of Beijing and Xiamen Jihong
Assuming the 90 days trading horizon Bank of Beijing is expected to under-perform the Xiamen Jihong. But the stock apears to be less risky and, when comparing its historical volatility, Bank of Beijing is 2.55 times less risky than Xiamen Jihong. The stock trades about -0.01 of its potential returns per unit of risk. The Xiamen Jihong Package is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,419 in Xiamen Jihong Package on September 5, 2024 and sell it today you would earn a total of 156.00 from holding Xiamen Jihong Package or generate 10.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Beijing vs. Xiamen Jihong Package
Performance |
| Timeline |
| Bank of Beijing |
| Xiamen Jihong Package |
Bank of Beijing and Xiamen Jihong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Beijing and Xiamen Jihong
The main advantage of trading using opposite Bank of Beijing and Xiamen Jihong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Beijing position performs unexpectedly, Xiamen Jihong 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 Xiamen Jihong will offset losses from the drop in Xiamen Jihong's long position.| Bank of Beijing vs. Xiamen Jihong Package | Bank of Beijing vs. Anji Foodstuff Co | Bank of Beijing vs. Hangzhou Pinming Software | Bank of Beijing vs. Shantou Wanshun Package |
| Xiamen Jihong vs. Zijin Mining Group | Xiamen Jihong vs. Wanhua Chemical Group | Xiamen Jihong vs. Baoshan Iron Steel | Xiamen Jihong vs. Rongsheng Petrochemical 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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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