Correlation Between China Life and Qinghaihuading Industrial
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By analyzing existing cross correlation between China Life Insurance and Qinghaihuading Industrial Co, you can compare the effects of market volatilities on China Life and Qinghaihuading Industrial 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 Qinghaihuading Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Qinghaihuading Industrial.
Diversification Opportunities for China Life and Qinghaihuading Industrial
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Qinghaihuading is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Qinghaihuading Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qinghaihuading Industrial 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 Qinghaihuading Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qinghaihuading Industrial has no effect on the direction of China Life i.e., China Life and Qinghaihuading Industrial go up and down completely randomly.
Pair Corralation between China Life and Qinghaihuading Industrial
Assuming the 90 days trading horizon China Life Insurance is expected to generate 0.67 times more return on investment than Qinghaihuading Industrial. However, China Life Insurance is 1.5 times less risky than Qinghaihuading Industrial. It trades about 0.03 of its potential returns per unit of risk. Qinghaihuading Industrial Co is currently generating about 0.01 per unit of risk. If you would invest 3,484 in China Life Insurance on September 2, 2024 and sell it today you would earn a total of 726.00 from holding China Life Insurance or generate 20.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Qinghaihuading Industrial Co
Performance |
| Timeline |
| China Life Insurance |
| Qinghaihuading Industrial |
China Life and Qinghaihuading Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Qinghaihuading Industrial
The main advantage of trading using opposite China Life and Qinghaihuading Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Qinghaihuading Industrial 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 Qinghaihuading Industrial will offset losses from the drop in Qinghaihuading Industrial's long position.| China Life vs. Industrial and Commercial | China Life vs. China Construction Bank | China Life vs. Bank of China | China Life vs. Agricultural Bank of |
| Qinghaihuading Industrial vs. New China Life | Qinghaihuading Industrial vs. Ming Yang Smart | Qinghaihuading Industrial vs. 159681 | Qinghaihuading Industrial vs. 159005 |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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