Correlation Between China Railway and Yonghui Superstores
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By analyzing existing cross correlation between China Railway Group and Yonghui Superstores Co, you can compare the effects of market volatilities on China Railway and Yonghui Superstores 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 Yonghui Superstores. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Yonghui Superstores.
Diversification Opportunities for China Railway and Yonghui Superstores
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Yonghui is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Yonghui Superstores Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yonghui Superstores 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 Yonghui Superstores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yonghui Superstores has no effect on the direction of China Railway i.e., China Railway and Yonghui Superstores go up and down completely randomly.
Pair Corralation between China Railway and Yonghui Superstores
Assuming the 90 days trading horizon China Railway is expected to generate 3.42 times less return on investment than Yonghui Superstores. But when comparing it to its historical volatility, China Railway Group is 1.79 times less risky than Yonghui Superstores. It trades about 0.03 of its potential returns per unit of risk. Yonghui Superstores Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 303.00 in Yonghui Superstores Co on August 29, 2024 and sell it today you would earn a total of 145.00 from holding Yonghui Superstores Co or generate 47.85% 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. Yonghui Superstores Co
Performance |
| Timeline |
| China Railway Group |
| Yonghui Superstores |
China Railway and Yonghui Superstores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Yonghui Superstores
The main advantage of trading using opposite China Railway and Yonghui Superstores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Yonghui Superstores 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 Yonghui Superstores will offset losses from the drop in Yonghui Superstores' long position.| China Railway vs. Hangzhou Gisway Information | China Railway vs. ButOne Information Corp | China Railway vs. Chinese Universe Publishing | China Railway vs. Zhejiang Publishing Media |
| Yonghui Superstores vs. PetroChina Co Ltd | Yonghui Superstores vs. China Mobile Limited | Yonghui Superstores vs. Ping An Insurance | Yonghui Superstores vs. China Petroleum Chemical |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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