Correlation Between Ping An and Liaoning Chengda
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By analyzing existing cross correlation between Ping An Insurance and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on Ping An and Liaoning Chengda 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 Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Liaoning Chengda.
Diversification Opportunities for Ping An and Liaoning Chengda
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ping and Liaoning is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio 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 Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of Ping An i.e., Ping An and Liaoning Chengda go up and down completely randomly.
Pair Corralation between Ping An and Liaoning Chengda
Assuming the 90 days trading horizon Ping An Insurance is expected to under-perform the Liaoning Chengda. In addition to that, Ping An is 1.3 times more volatile than Liaoning Chengda Biotechnology. It trades about -0.1 of its total potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about 0.01 per unit of volatility. If you would invest 2,728 in Liaoning Chengda Biotechnology on September 1, 2024 and sell it today you would earn a total of 4.00 from holding Liaoning Chengda Biotechnology or generate 0.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| Ping An Insurance |
| Liaoning Chengda Bio |
Ping An and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Liaoning Chengda
The main advantage of trading using opposite Ping An and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| Ping An vs. Industrial and Commercial | Ping An vs. China Construction Bank | Ping An vs. Bank of China | Ping An vs. Agricultural Bank of |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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