Correlation Between Bank of Communications and Shenzhen
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By analyzing existing cross correlation between Bank of Communications and Shenzhen AV Display Co, you can compare the effects of market volatilities on Bank of Communications and Shenzhen 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 Shenzhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Communications and Shenzhen.
Diversification Opportunities for Bank of Communications and Shenzhen
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Shenzhen is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Communications and Shenzhen AV Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen AV Display 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 Shenzhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen AV Display has no effect on the direction of Bank of Communications i.e., Bank of Communications and Shenzhen go up and down completely randomly.
Pair Corralation between Bank of Communications and Shenzhen
Assuming the 90 days trading horizon Bank of Communications is expected to generate 0.37 times more return on investment than Shenzhen. However, Bank of Communications is 2.68 times less risky than Shenzhen. It trades about 0.08 of its potential returns per unit of risk. Shenzhen AV Display Co is currently generating about 0.02 per unit of risk. If you would invest 453.00 in Bank of Communications on October 27, 2024 and sell it today you would earn a total of 264.00 from holding Bank of Communications or generate 58.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Communications vs. Shenzhen AV Display Co
Performance |
| Timeline |
| Bank of Communications |
| Shenzhen AV Display |
Bank of Communications and Shenzhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Communications and Shenzhen
The main advantage of trading using opposite Bank of Communications and Shenzhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Communications position performs unexpectedly, Shenzhen 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 Shenzhen will offset losses from the drop in Shenzhen's long position.| Bank of Communications vs. COL Digital Publishing | Bank of Communications vs. Shanghai Action Education | Bank of Communications vs. Xinhua Winshare Publishing | Bank of Communications vs. Yankershop Food Co |
| Shenzhen vs. Yindu Kitchen Equipment | Shenzhen vs. Beijing Bewinner Communications | Shenzhen vs. Bank of Communications | Shenzhen vs. Aba Chemicals Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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