Correlation Between China Life and Heilongjiang Publishing
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By analyzing existing cross correlation between China Life Insurance and Heilongjiang Publishing Media, you can compare the effects of market volatilities on China Life and Heilongjiang Publishing 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 Heilongjiang Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Heilongjiang Publishing.
Diversification Opportunities for China Life and Heilongjiang Publishing
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Heilongjiang is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Heilongjiang Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heilongjiang Publishing 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 Heilongjiang Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heilongjiang Publishing has no effect on the direction of China Life i.e., China Life and Heilongjiang Publishing go up and down completely randomly.
Pair Corralation between China Life and Heilongjiang Publishing
Assuming the 90 days trading horizon China Life is expected to generate 8.97 times less return on investment than Heilongjiang Publishing. But when comparing it to its historical volatility, China Life Insurance is 1.27 times less risky than Heilongjiang Publishing. It trades about 0.02 of its potential returns per unit of risk. Heilongjiang Publishing Media is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,480 in Heilongjiang Publishing Media on September 1, 2024 and sell it today you would earn a total of 200.00 from holding Heilongjiang Publishing Media or generate 13.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Heilongjiang Publishing Media
Performance |
| Timeline |
| China Life Insurance |
| Heilongjiang Publishing |
China Life and Heilongjiang Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Heilongjiang Publishing
The main advantage of trading using opposite China Life and Heilongjiang Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Heilongjiang Publishing 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 Heilongjiang Publishing will offset losses from the drop in Heilongjiang Publishing's long position.| China Life vs. Industrial and Commercial | China Life vs. China Construction Bank | China Life vs. Bank of China | China Life vs. Agricultural Bank of |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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