Correlation Between China Life and Shenzhen Centralcon
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By analyzing existing cross correlation between China Life Insurance and Shenzhen Centralcon Investment, you can compare the effects of market volatilities on China Life and Shenzhen Centralcon 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 Life with a short position of Shenzhen Centralcon. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Shenzhen Centralcon.
Diversification Opportunities for China Life and Shenzhen Centralcon
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Shenzhen is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Shenzhen Centralcon Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Centralcon and China Life 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 Life Insurance are associated (or correlated) with Shenzhen Centralcon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Centralcon has no effect on the direction of China Life i.e., China Life and Shenzhen Centralcon go up and down completely randomly.
Pair Corralation between China Life and Shenzhen Centralcon
Assuming the 90 days trading horizon China Life Insurance is expected to under-perform the Shenzhen Centralcon. But the stock apears to be less risky and, when comparing its historical volatility, China Life Insurance is 1.23 times less risky than Shenzhen Centralcon. The stock trades about -0.04 of its potential returns per unit of risk. The Shenzhen Centralcon Investment is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 522.00 in Shenzhen Centralcon Investment on September 14, 2024 and sell it today you would earn a total of 65.00 from holding Shenzhen Centralcon Investment or generate 12.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Shenzhen Centralcon Investment
Performance |
| Timeline |
| China Life Insurance |
| Shenzhen Centralcon |
China Life and Shenzhen Centralcon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Shenzhen Centralcon
The main advantage of trading using opposite China Life and Shenzhen Centralcon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Shenzhen Centralcon 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 Shenzhen Centralcon will offset losses from the drop in Shenzhen Centralcon's long position.| China Life vs. BYD Co Ltd | China Life vs. China Mobile Limited | China Life vs. Agricultural Bank of | China Life vs. Industrial and Commercial |
| Shenzhen Centralcon vs. China Life Insurance | Shenzhen Centralcon vs. Cinda Securities Co | Shenzhen Centralcon vs. Piotech Inc A | Shenzhen Centralcon vs. Dongxing Sec Co |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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