Correlation Between New China and BlueFocus Communication
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By analyzing existing cross correlation between New China Life and BlueFocus Communication Group, you can compare the effects of market volatilities on New China and BlueFocus Communication 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 New China with a short position of BlueFocus Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of New China and BlueFocus Communication.
Diversification Opportunities for New China and BlueFocus Communication
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between New and BlueFocus is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding New China Life and BlueFocus Communication Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BlueFocus Communication and New China 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 New China Life are associated (or correlated) with BlueFocus Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BlueFocus Communication has no effect on the direction of New China i.e., New China and BlueFocus Communication go up and down completely randomly.
Pair Corralation between New China and BlueFocus Communication
Assuming the 90 days trading horizon New China Life is expected to under-perform the BlueFocus Communication. But the stock apears to be less risky and, when comparing its historical volatility, New China Life is 2.03 times less risky than BlueFocus Communication. The stock trades about -0.02 of its potential returns per unit of risk. The BlueFocus Communication Group is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 721.00 in BlueFocus Communication Group on August 31, 2024 and sell it today you would earn a total of 319.00 from holding BlueFocus Communication Group or generate 44.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
New China Life vs. BlueFocus Communication Group
Performance |
| Timeline |
| New China Life |
| BlueFocus Communication |
New China and BlueFocus Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New China and BlueFocus Communication
The main advantage of trading using opposite New China and BlueFocus Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New China position performs unexpectedly, BlueFocus Communication 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 BlueFocus Communication will offset losses from the drop in BlueFocus Communication's long position.| New China vs. CareRay Digital Medical | New China vs. Zhengzhou Coal Mining | New China vs. Jinhui Mining Co | New China vs. Double Medical Technology |
| BlueFocus Communication vs. BYD Co Ltd | BlueFocus Communication vs. Agricultural Bank of | BlueFocus Communication vs. Industrial and Commercial | BlueFocus Communication vs. China State Construction |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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