Correlation Between China Life and Xizi Clean
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By analyzing existing cross correlation between China Life Insurance and Xizi Clean Energy, you can compare the effects of market volatilities on China Life and Xizi Clean 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 Xizi Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Xizi Clean.
Diversification Opportunities for China Life and Xizi Clean
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Xizi is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Xizi Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xizi Clean Energy 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 Xizi Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xizi Clean Energy has no effect on the direction of China Life i.e., China Life and Xizi Clean go up and down completely randomly.
Pair Corralation between China Life and Xizi Clean
Assuming the 90 days trading horizon China Life is expected to generate 6.34 times less return on investment than Xizi Clean. But when comparing it to its historical volatility, China Life Insurance is 2.14 times less risky than Xizi Clean. It trades about 0.07 of its potential returns per unit of risk. Xizi Clean Energy is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,079 in Xizi Clean Energy on November 3, 2024 and sell it today you would earn a total of 146.00 from holding Xizi Clean Energy or generate 13.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Xizi Clean Energy
Performance |
| Timeline |
| China Life Insurance |
| Xizi Clean Energy |
China Life and Xizi Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Xizi Clean
The main advantage of trading using opposite China Life and Xizi Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Xizi Clean 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 Xizi Clean will offset losses from the drop in Xizi Clean's long position.| China Life vs. Shenzhen Noposion Agrochemicals | China Life vs. Shenyang Chemical Industry | China Life vs. Daoming OpticsChemical Co | China Life vs. Semiconductor Manufacturing Intl |
| Xizi Clean vs. Agricultural Bank of | Xizi Clean vs. Industrial and Commercial | Xizi Clean vs. Bank of China | Xizi Clean vs. PetroChina Co Ltd |
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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