Correlation Between China Railway and Mingchen Health
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By analyzing existing cross correlation between China Railway Group and Mingchen Health Co, you can compare the effects of market volatilities on China Railway and Mingchen Health 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 Mingchen Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Mingchen Health.
Diversification Opportunities for China Railway and Mingchen Health
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Mingchen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Mingchen Health Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mingchen Health 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 Mingchen Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mingchen Health has no effect on the direction of China Railway i.e., China Railway and Mingchen Health go up and down completely randomly.
Pair Corralation between China Railway and Mingchen Health
Assuming the 90 days trading horizon China Railway Group is expected to generate 0.62 times more return on investment than Mingchen Health. However, China Railway Group is 1.61 times less risky than Mingchen Health. It trades about 0.03 of its potential returns per unit of risk. Mingchen Health Co is currently generating about 0.01 per unit of risk. If you would invest 544.00 in China Railway Group on September 12, 2024 and sell it today you would earn a total of 115.00 from holding China Railway Group or generate 21.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Mingchen Health Co
Performance |
| Timeline |
| China Railway Group |
| Mingchen Health |
China Railway and Mingchen Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Mingchen Health
The main advantage of trading using opposite China Railway and Mingchen Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Mingchen Health 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 Mingchen Health will offset losses from the drop in Mingchen Health's long position.| China Railway vs. Changchun BCHT Biotechnology | China Railway vs. Ningbo MedicalSystem Biotechnology | China Railway vs. Lander Sports Development | China Railway vs. Heilongjiang Publishing Media |
| Mingchen Health vs. China Petroleum Chemical | Mingchen Health vs. PetroChina Co Ltd | Mingchen Health vs. China State Construction | Mingchen Health vs. China Railway Group |
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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