Correlation Between China Life and Zhejiang Daily
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By analyzing existing cross correlation between China Life Insurance and Zhejiang Daily Media, you can compare the effects of market volatilities on China Life and Zhejiang Daily 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 Zhejiang Daily. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Zhejiang Daily.
Diversification Opportunities for China Life and Zhejiang Daily
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Zhejiang is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Zhejiang Daily Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Daily Media 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 Zhejiang Daily. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Daily Media has no effect on the direction of China Life i.e., China Life and Zhejiang Daily go up and down completely randomly.
Pair Corralation between China Life and Zhejiang Daily
Assuming the 90 days trading horizon China Life Insurance is expected to under-perform the Zhejiang Daily. In addition to that, China Life is 1.15 times more volatile than Zhejiang Daily Media. It trades about -0.02 of its total potential returns per unit of risk. Zhejiang Daily Media is currently generating about 0.01 per unit of volatility. If you would invest 1,097 in Zhejiang Daily Media on August 30, 2024 and sell it today you would lose (3.00) from holding Zhejiang Daily Media or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Zhejiang Daily Media
Performance |
| Timeline |
| China Life Insurance |
| Zhejiang Daily Media |
China Life and Zhejiang Daily Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Zhejiang Daily
The main advantage of trading using opposite China Life and Zhejiang Daily positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Zhejiang Daily 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 Zhejiang Daily will offset losses from the drop in Zhejiang Daily's long position.| China Life vs. Industrial and Commercial | China Life vs. Agricultural Bank of | China Life vs. China Construction Bank | China Life vs. Bank of China |
| Zhejiang Daily vs. Industrial and Commercial | Zhejiang Daily vs. China Construction Bank | Zhejiang Daily vs. Agricultural Bank of | Zhejiang Daily vs. Bank of China |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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