Correlation Between Bank of Communications and Shantui Construction
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By analyzing existing cross correlation between Bank of Communications and Shantui Construction Machinery, you can compare the effects of market volatilities on Bank of Communications and Shantui Construction 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 Bank of Communications with a short position of Shantui Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Communications and Shantui Construction.
Diversification Opportunities for Bank of Communications and Shantui Construction
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Shantui is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Communications and Shantui Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shantui Construction and Bank of Communications 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 Bank of Communications are associated (or correlated) with Shantui Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shantui Construction has no effect on the direction of Bank of Communications i.e., Bank of Communications and Shantui Construction go up and down completely randomly.
Pair Corralation between Bank of Communications and Shantui Construction
Assuming the 90 days trading horizon Bank of Communications is expected to generate 4.87 times less return on investment than Shantui Construction. But when comparing it to its historical volatility, Bank of Communications is 2.4 times less risky than Shantui Construction. It trades about 0.07 of its potential returns per unit of risk. Shantui Construction Machinery is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 978.00 in Shantui Construction Machinery on September 5, 2024 and sell it today you would earn a total of 87.00 from holding Shantui Construction Machinery or generate 8.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Communications vs. Shantui Construction Machinery
Performance |
| Timeline |
| Bank of Communications |
| Shantui Construction |
Bank of Communications and Shantui Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Communications and Shantui Construction
The main advantage of trading using opposite Bank of Communications and Shantui Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Communications position performs unexpectedly, Shantui Construction 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 Shantui Construction will offset losses from the drop in Shantui Construction's long position.| Bank of Communications vs. Ming Yang Smart | Bank of Communications vs. 159681 | Bank of Communications vs. 159005 | Bank of Communications vs. Loctek Ergonomic Technology |
| Shantui Construction vs. Qtone Education Group | Shantui Construction vs. Leyard Optoelectronic | Shantui Construction vs. TongFu Microelectronics Co | Shantui Construction vs. Kunshan Guoli Electronic |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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