Correlation Between China Life and Beijing Mainstreets
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By analyzing existing cross correlation between China Life Insurance and Beijing Mainstreets Investment, you can compare the effects of market volatilities on China Life and Beijing Mainstreets 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 Beijing Mainstreets. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Beijing Mainstreets.
Diversification Opportunities for China Life and Beijing Mainstreets
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Beijing is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Beijing Mainstreets Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Mainstreets 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 Beijing Mainstreets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Mainstreets has no effect on the direction of China Life i.e., China Life and Beijing Mainstreets go up and down completely randomly.
Pair Corralation between China Life and Beijing Mainstreets
Assuming the 90 days trading horizon China Life Insurance is expected to generate 0.7 times more return on investment than Beijing Mainstreets. However, China Life Insurance is 1.44 times less risky than Beijing Mainstreets. It trades about -0.16 of its potential returns per unit of risk. Beijing Mainstreets Investment is currently generating about -0.19 per unit of risk. If you would invest 4,575 in China Life Insurance on September 15, 2024 and sell it today you would lose (360.00) from holding China Life Insurance or give up 7.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Beijing Mainstreets Investment
Performance |
| Timeline |
| China Life Insurance |
| Beijing Mainstreets |
China Life and Beijing Mainstreets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Beijing Mainstreets
The main advantage of trading using opposite China Life and Beijing Mainstreets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Beijing Mainstreets 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 Beijing Mainstreets will offset losses from the drop in Beijing Mainstreets' 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 |
| Beijing Mainstreets vs. V V Food | Beijing Mainstreets vs. Juewei Food Co | Beijing Mainstreets vs. Sichuan Fulin Transportation | Beijing Mainstreets vs. Xinjiang Tianrun Dairy |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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