Correlation Between China Life and Shanghai Jinfeng
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By analyzing existing cross correlation between China Life Insurance and Shanghai Jinfeng Wine, you can compare the effects of market volatilities on China Life and Shanghai Jinfeng 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 Shanghai Jinfeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Shanghai Jinfeng.
Diversification Opportunities for China Life and Shanghai Jinfeng
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Shanghai is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Shanghai Jinfeng Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Jinfeng Wine 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 Shanghai Jinfeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Jinfeng Wine has no effect on the direction of China Life i.e., China Life and Shanghai Jinfeng go up and down completely randomly.
Pair Corralation between China Life and Shanghai Jinfeng
Assuming the 90 days trading horizon China Life Insurance is expected to generate 0.79 times more return on investment than Shanghai Jinfeng. However, China Life Insurance is 1.26 times less risky than Shanghai Jinfeng. It trades about 0.06 of its potential returns per unit of risk. Shanghai Jinfeng Wine is currently generating about 0.03 per unit of risk. If you would invest 3,136 in China Life Insurance on September 14, 2024 and sell it today you would earn a total of 1,079 from holding China Life Insurance or generate 34.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.62% |
| Values | Daily Returns |
China Life Insurance vs. Shanghai Jinfeng Wine
Performance |
| Timeline |
| China Life Insurance |
| Shanghai Jinfeng Wine |
China Life and Shanghai Jinfeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Shanghai Jinfeng
The main advantage of trading using opposite China Life and Shanghai Jinfeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Shanghai Jinfeng 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 Shanghai Jinfeng will offset losses from the drop in Shanghai Jinfeng'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 |
| Shanghai Jinfeng vs. China Life Insurance | Shanghai Jinfeng vs. Cinda Securities Co | Shanghai Jinfeng vs. Piotech Inc A | Shanghai Jinfeng 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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