Correlation Between China Life and Hubeiyichang Transportation
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By analyzing existing cross correlation between China Life Insurance and Hubeiyichang Transportation Group, you can compare the effects of market volatilities on China Life and Hubeiyichang Transportation 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 Hubeiyichang Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Hubeiyichang Transportation.
Diversification Opportunities for China Life and Hubeiyichang Transportation
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Hubeiyichang is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Hubeiyichang Transportation Gr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubeiyichang Transportation 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 Hubeiyichang Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubeiyichang Transportation has no effect on the direction of China Life i.e., China Life and Hubeiyichang Transportation go up and down completely randomly.
Pair Corralation between China Life and Hubeiyichang Transportation
Assuming the 90 days trading horizon China Life Insurance is expected to under-perform the Hubeiyichang Transportation. In addition to that, China Life is 2.23 times more volatile than Hubeiyichang Transportation Group. It trades about -0.07 of its total potential returns per unit of risk. Hubeiyichang Transportation Group is currently generating about 0.06 per unit of volatility. If you would invest 506.00 in Hubeiyichang Transportation Group on August 25, 2024 and sell it today you would earn a total of 8.00 from holding Hubeiyichang Transportation Group or generate 1.58% 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. Hubeiyichang Transportation Gr
Performance |
| Timeline |
| China Life Insurance |
| Hubeiyichang Transportation |
China Life and Hubeiyichang Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Hubeiyichang Transportation
The main advantage of trading using opposite China Life and Hubeiyichang Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Hubeiyichang Transportation 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 Hubeiyichang Transportation will offset losses from the drop in Hubeiyichang Transportation's long position.| China Life vs. Ming Yang Smart | China Life vs. 159681 | China Life vs. 159005 | China Life vs. Loctek Ergonomic Technology |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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