Correlation Between Ping An and Long Yuan
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By analyzing existing cross correlation between Ping An Insurance and Long Yuan Construction, you can compare the effects of market volatilities on Ping An and Long Yuan 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 Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Long Yuan.
Diversification Opportunities for Ping An and Long Yuan
Very poor diversification
The 3 months correlation between Ping and Long is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction 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 Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Ping An i.e., Ping An and Long Yuan go up and down completely randomly.
Pair Corralation between Ping An and Long Yuan
Assuming the 90 days trading horizon Ping An Insurance is expected to generate 0.61 times more return on investment than Long Yuan. However, Ping An Insurance is 1.64 times less risky than Long Yuan. It trades about -0.16 of its potential returns per unit of risk. Long Yuan Construction is currently generating about -0.1 per unit of risk. If you would invest 5,750 in Ping An Insurance on August 29, 2024 and sell it today you would lose (445.00) from holding Ping An Insurance or give up 7.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. Long Yuan Construction
Performance |
| Timeline |
| Ping An Insurance |
| Long Yuan Construction |
Ping An and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Long Yuan
The main advantage of trading using opposite Ping An and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Ping An vs. Ming Yang Smart | Ping An vs. 159681 | Ping An vs. 159005 | Ping An vs. Loctek Ergonomic Technology |
| Long Yuan vs. Ming Yang Smart | Long Yuan vs. 159681 | Long Yuan vs. 159005 | Long Yuan vs. Loctek Ergonomic Technology |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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