Correlation Between Ping An and China Reform
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By analyzing existing cross correlation between Ping An Insurance and China Reform Health, you can compare the effects of market volatilities on Ping An and China Reform 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 Ping An with a short position of China Reform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and China Reform.
Diversification Opportunities for Ping An and China Reform
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ping and China is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and China Reform Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Reform Health and Ping An 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 Ping An Insurance are associated (or correlated) with China Reform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Reform Health has no effect on the direction of Ping An i.e., Ping An and China Reform go up and down completely randomly.
Pair Corralation between Ping An and China Reform
Assuming the 90 days trading horizon Ping An is expected to generate 5.11 times less return on investment than China Reform. But when comparing it to its historical volatility, Ping An Insurance is 3.6 times less risky than China Reform. It trades about 0.07 of its potential returns per unit of risk. China Reform Health is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,065 in China Reform Health on December 1, 2024 and sell it today you would earn a total of 64.00 from holding China Reform Health or generate 6.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. China Reform Health
Performance |
| Timeline |
| Ping An Insurance |
| China Reform Health |
Ping An and China Reform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and China Reform
The main advantage of trading using opposite Ping An and China Reform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, China Reform 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 China Reform will offset losses from the drop in China Reform's long position.| Ping An vs. Changjiang Publishing Media | Ping An vs. JiShi Media Co | Ping An vs. Southern PublishingMedia Co | Ping An vs. Shandong Publishing Media |
| China Reform vs. Fujian Newland Computer | China Reform vs. Jinzai Food Group | China Reform vs. Allwin Telecommunication Co | China Reform vs. Gan Yuan Foods |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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