Correlation Between China Railway and Dezhan HealthCare
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By analyzing existing cross correlation between China Railway Group and Dezhan HealthCare Co, you can compare the effects of market volatilities on China Railway and Dezhan HealthCare 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 China Railway with a short position of Dezhan HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Dezhan HealthCare.
Diversification Opportunities for China Railway and Dezhan HealthCare
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Dezhan is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Dezhan HealthCare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dezhan HealthCare and China Railway 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 China Railway Group are associated (or correlated) with Dezhan HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dezhan HealthCare has no effect on the direction of China Railway i.e., China Railway and Dezhan HealthCare go up and down completely randomly.
Pair Corralation between China Railway and Dezhan HealthCare
Assuming the 90 days trading horizon China Railway Group is expected to generate 0.8 times more return on investment than Dezhan HealthCare. However, China Railway Group is 1.24 times less risky than Dezhan HealthCare. It trades about 0.02 of its potential returns per unit of risk. Dezhan HealthCare Co is currently generating about 0.0 per unit of risk. If you would invest 583.00 in China Railway Group on September 3, 2024 and sell it today you would earn a total of 58.00 from holding China Railway Group or generate 9.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Dezhan HealthCare Co
Performance |
| Timeline |
| China Railway Group |
| Dezhan HealthCare |
China Railway and Dezhan HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Dezhan HealthCare
The main advantage of trading using opposite China Railway and Dezhan HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Dezhan HealthCare 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 Dezhan HealthCare will offset losses from the drop in Dezhan HealthCare's long position.| China Railway vs. Zhongtong Guomai Communication | China Railway vs. Ningbo Homelink Eco iTech | China Railway vs. Wuhan Yangtze Communication | China Railway vs. Railway Signal Communication |
| Dezhan HealthCare vs. Chengdu Kanghua Biological | Dezhan HealthCare vs. Beijing Wantai Biological | Dezhan HealthCare vs. Suzhou Novoprotein Scientific | Dezhan HealthCare vs. Aluminum Corp of |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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