Correlation Between Industrial and China Sports
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By analyzing existing cross correlation between Industrial and Commercial and China Sports Industry, you can compare the effects of market volatilities on Industrial and China Sports 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 Industrial with a short position of China Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and China Sports.
Diversification Opportunities for Industrial and China Sports
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Industrial and China is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and China Sports Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Sports Industry and Industrial 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 Industrial and Commercial are associated (or correlated) with China Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Sports Industry has no effect on the direction of Industrial i.e., Industrial and China Sports go up and down completely randomly.
Pair Corralation between Industrial and China Sports
Assuming the 90 days trading horizon Industrial and Commercial is expected to under-perform the China Sports. But the stock apears to be less risky and, when comparing its historical volatility, Industrial and Commercial is 2.33 times less risky than China Sports. The stock trades about -0.08 of its potential returns per unit of risk. The China Sports Industry is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 770.00 in China Sports Industry on August 25, 2024 and sell it today you would earn a total of 24.00 from holding China Sports Industry or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. China Sports Industry
Performance |
| Timeline |
| Industrial and Commercial |
| China Sports Industry |
Industrial and China Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and China Sports
The main advantage of trading using opposite Industrial and China Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, China Sports 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 China Sports will offset losses from the drop in China Sports' long position.| Industrial vs. Anhui Huilong Agricultural | Industrial vs. Agricultural Bank of | Industrial vs. Masterwork Machinery | Industrial vs. Huitong Construction Group |
| China Sports vs. Industrial and Commercial | China Sports vs. China Construction Bank | China Sports vs. Bank of China | China Sports vs. Agricultural Bank 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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