Correlation Between Bank of Communications and Beijing Kingsoft
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By analyzing existing cross correlation between Bank of Communications and Beijing Kingsoft Office, you can compare the effects of market volatilities on Bank of Communications and Beijing Kingsoft 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 Beijing Kingsoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Communications and Beijing Kingsoft.
Diversification Opportunities for Bank of Communications and Beijing Kingsoft
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Beijing is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Communications and Beijing Kingsoft Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Kingsoft Office 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 Beijing Kingsoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Kingsoft Office has no effect on the direction of Bank of Communications i.e., Bank of Communications and Beijing Kingsoft go up and down completely randomly.
Pair Corralation between Bank of Communications and Beijing Kingsoft
Assuming the 90 days trading horizon Bank of Communications is expected to under-perform the Beijing Kingsoft. But the stock apears to be less risky and, when comparing its historical volatility, Bank of Communications is 2.12 times less risky than Beijing Kingsoft. The stock trades about -0.15 of its potential returns per unit of risk. The Beijing Kingsoft Office is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 28,833 in Beijing Kingsoft Office on October 26, 2024 and sell it today you would lose (580.00) from holding Beijing Kingsoft Office or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Communications vs. Beijing Kingsoft Office
Performance |
| Timeline |
| Bank of Communications |
| Beijing Kingsoft Office |
Bank of Communications and Beijing Kingsoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Communications and Beijing Kingsoft
The main advantage of trading using opposite Bank of Communications and Beijing Kingsoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Communications position performs unexpectedly, Beijing Kingsoft 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 Beijing Kingsoft will offset losses from the drop in Beijing Kingsoft's long position.| Bank of Communications vs. Beijing Seeyon Internet | Bank of Communications vs. Tianjin Hi Tech Development | Bank of Communications vs. Shandong Rike Chemical | Bank of Communications vs. Xilong Chemical Co |
| Beijing Kingsoft vs. Bank of China | Beijing Kingsoft vs. Kweichow Moutai Co | Beijing Kingsoft vs. PetroChina Co Ltd | Beijing Kingsoft vs. Bank of Communications |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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