Correlation Between China Life and Tibet Huayu
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By analyzing existing cross correlation between China Life Insurance and Tibet Huayu Mining, you can compare the effects of market volatilities on China Life and Tibet Huayu 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 Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Tibet Huayu.
Diversification Opportunities for China Life and Tibet Huayu
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Tibet is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining 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 Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of China Life i.e., China Life and Tibet Huayu go up and down completely randomly.
Pair Corralation between China Life and Tibet Huayu
Assuming the 90 days trading horizon China Life is expected to generate 2.26 times less return on investment than Tibet Huayu. But when comparing it to its historical volatility, China Life Insurance is 1.56 times less risky than Tibet Huayu. It trades about 0.02 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 972.00 in Tibet Huayu Mining on October 21, 2024 and sell it today you would earn a total of 304.00 from holding Tibet Huayu Mining or generate 31.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Tibet Huayu Mining
Performance |
| Timeline |
| China Life Insurance |
| Tibet Huayu Mining |
China Life and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Tibet Huayu
The main advantage of trading using opposite China Life and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.| China Life vs. Cabio Biotech Wuhan | China Life vs. V V Food | China Life vs. Guangzhou KingTeller Technology | China Life vs. Tianshui Huatian Technology |
| Tibet Huayu vs. Metro Investment Development | Tibet Huayu vs. Dareway Software Co | Tibet Huayu vs. China Life Insurance | Tibet Huayu vs. Zhejiang Construction Investment |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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