Correlation Between Ping An and Qijing Machinery
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By analyzing existing cross correlation between Ping An Insurance and Qijing Machinery, you can compare the effects of market volatilities on Ping An and Qijing Machinery 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 Qijing Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Qijing Machinery.
Diversification Opportunities for Ping An and Qijing Machinery
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ping and Qijing is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Qijing Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qijing Machinery 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 Qijing Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qijing Machinery has no effect on the direction of Ping An i.e., Ping An and Qijing Machinery go up and down completely randomly.
Pair Corralation between Ping An and Qijing Machinery
Assuming the 90 days trading horizon Ping An Insurance is expected to generate 0.63 times more return on investment than Qijing Machinery. However, Ping An Insurance is 1.59 times less risky than Qijing Machinery. It trades about 0.08 of its potential returns per unit of risk. Qijing Machinery is currently generating about 0.01 per unit of risk. If you would invest 3,960 in Ping An Insurance on September 4, 2024 and sell it today you would earn a total of 1,483 from holding Ping An Insurance or generate 37.45% 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. Qijing Machinery
Performance |
| Timeline |
| Ping An Insurance |
| Qijing Machinery |
Ping An and Qijing Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Qijing Machinery
The main advantage of trading using opposite Ping An and Qijing Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Qijing Machinery 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 Qijing Machinery will offset losses from the drop in Qijing Machinery's long position.| Ping An vs. Dazhong Transportation Group | Ping An vs. Hainan Haiqi Transportation | Ping An vs. Lander Sports Development | Ping An vs. Hengdian Entertainment Co |
| Qijing Machinery vs. PetroChina Co Ltd | Qijing Machinery vs. China Mobile Limited | Qijing Machinery vs. CNOOC Limited | Qijing Machinery vs. Ping An Insurance |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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