Correlation Between China Life and Xiamen Goldenhome
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By analyzing existing cross correlation between China Life Insurance and Xiamen Goldenhome Co, you can compare the effects of market volatilities on China Life and Xiamen Goldenhome 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 Xiamen Goldenhome. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Xiamen Goldenhome.
Diversification Opportunities for China Life and Xiamen Goldenhome
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Xiamen is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Xiamen Goldenhome Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Goldenhome 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 Xiamen Goldenhome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Goldenhome has no effect on the direction of China Life i.e., China Life and Xiamen Goldenhome go up and down completely randomly.
Pair Corralation between China Life and Xiamen Goldenhome
Assuming the 90 days trading horizon China Life Insurance is expected to under-perform the Xiamen Goldenhome. In addition to that, China Life is 1.6 times more volatile than Xiamen Goldenhome Co. It trades about -0.07 of its total potential returns per unit of risk. Xiamen Goldenhome Co is currently generating about 0.17 per unit of volatility. If you would invest 1,863 in Xiamen Goldenhome Co on August 25, 2024 and sell it today you would earn a total of 133.00 from holding Xiamen Goldenhome Co or generate 7.14% 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. Xiamen Goldenhome Co
Performance |
| Timeline |
| China Life Insurance |
| Xiamen Goldenhome |
China Life and Xiamen Goldenhome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Xiamen Goldenhome
The main advantage of trading using opposite China Life and Xiamen Goldenhome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Xiamen Goldenhome 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 Xiamen Goldenhome will offset losses from the drop in Xiamen Goldenhome's long position.| China Life vs. Xiamen Goldenhome Co | China Life vs. Tianjin Hi Tech Development | China Life vs. Zhejiang JIULI Hi tech | China Life vs. Guangdong Shenglu Telecommunication |
| Xiamen Goldenhome vs. Kweichow Moutai Co | Xiamen Goldenhome vs. Contemporary Amperex Technology | Xiamen Goldenhome vs. G bits Network Technology | Xiamen Goldenhome vs. Beijing Roborock 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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