Correlation Between Ping An and Xiamen Bank
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By analyzing existing cross correlation between Ping An Insurance and Xiamen Bank Co, you can compare the effects of market volatilities on Ping An and Xiamen Bank 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 Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Xiamen Bank.
Diversification Opportunities for Ping An and Xiamen Bank
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ping and Xiamen is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank 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 Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Ping An i.e., Ping An and Xiamen Bank go up and down completely randomly.
Pair Corralation between Ping An and Xiamen Bank
Assuming the 90 days trading horizon Ping An Insurance is expected to under-perform the Xiamen Bank. But the stock apears to be less risky and, when comparing its historical volatility, Ping An Insurance is 1.29 times less risky than Xiamen Bank. The stock trades about -0.14 of its potential returns per unit of risk. The Xiamen Bank Co is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 537.00 in Xiamen Bank Co on September 12, 2024 and sell it today you would earn a total of 41.00 from holding Xiamen Bank Co or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ping An Insurance vs. Xiamen Bank Co
Performance |
| Timeline |
| Ping An Insurance |
| Xiamen Bank |
Ping An and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Xiamen Bank
The main advantage of trading using opposite Ping An and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Xiamen Bank 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 Bank will offset losses from the drop in Xiamen Bank's long position.| Ping An vs. China Petroleum Chemical | Ping An vs. PetroChina Co Ltd | Ping An vs. China Mobile Limited | Ping An vs. Industrial and Commercial |
| Xiamen Bank vs. China Petroleum Chemical | Xiamen Bank vs. PetroChina Co Ltd | Xiamen Bank vs. China Mobile Limited | Xiamen Bank vs. Industrial and Commercial |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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