Correlation Between China Life and AUPU Home
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By analyzing existing cross correlation between China Life Insurance and AUPU Home Style, you can compare the effects of market volatilities on China Life and AUPU Home 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 AUPU Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and AUPU Home.
Diversification Opportunities for China Life and AUPU Home
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and AUPU is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and AUPU Home Style in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AUPU Home Style 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 AUPU Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AUPU Home Style has no effect on the direction of China Life i.e., China Life and AUPU Home go up and down completely randomly.
Pair Corralation between China Life and AUPU Home
Assuming the 90 days trading horizon China Life is expected to generate 1.24 times less return on investment than AUPU Home. But when comparing it to its historical volatility, China Life Insurance is 1.11 times less risky than AUPU Home. It trades about 0.03 of its potential returns per unit of risk. AUPU Home Style is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 893.00 in AUPU Home Style on September 3, 2024 and sell it today you would earn a total of 231.00 from holding AUPU Home Style or generate 25.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. AUPU Home Style
Performance |
| Timeline |
| China Life Insurance |
| AUPU Home Style |
China Life and AUPU Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and AUPU Home
The main advantage of trading using opposite China Life and AUPU Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, AUPU Home 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 AUPU Home will offset losses from the drop in AUPU Home's long position.| China Life vs. Chongqing Road Bridge | China Life vs. Wuhan Xianglong Power | China Life vs. Empyrean Technology Co | China Life vs. Yuanjie Semiconductor Technology |
| AUPU Home vs. PetroChina Co Ltd | AUPU Home vs. China Mobile Limited | AUPU Home vs. Industrial and Commercial | AUPU Home vs. China Life Insurance |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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