Correlation Between China Life and Shanghai CEO
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By analyzing existing cross correlation between China Life Insurance and Shanghai CEO Environmental, you can compare the effects of market volatilities on China Life and Shanghai CEO 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 Shanghai CEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Shanghai CEO.
Diversification Opportunities for China Life and Shanghai CEO
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Shanghai is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Shanghai CEO Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai CEO Environ 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 Shanghai CEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai CEO Environ has no effect on the direction of China Life i.e., China Life and Shanghai CEO go up and down completely randomly.
Pair Corralation between China Life and Shanghai CEO
Assuming the 90 days trading horizon China Life Insurance is expected to generate 0.81 times more return on investment than Shanghai CEO. However, China Life Insurance is 1.23 times less risky than Shanghai CEO. It trades about -0.21 of its potential returns per unit of risk. Shanghai CEO Environmental is currently generating about -0.19 per unit of risk. If you would invest 4,718 in China Life Insurance on October 11, 2024 and sell it today you would lose (811.00) from holding China Life Insurance or give up 17.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Life Insurance vs. Shanghai CEO Environmental
Performance |
| Timeline |
| China Life Insurance |
| Shanghai CEO Environ |
China Life and Shanghai CEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Life and Shanghai CEO
The main advantage of trading using opposite China Life and Shanghai CEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Shanghai CEO 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 Shanghai CEO will offset losses from the drop in Shanghai CEO's long position.| China Life vs. Sanbo Hospital Management | China Life vs. China Reform Health | China Life vs. Sinomach General Machinery | China Life vs. Jinlong Machinery Electronic |
| Shanghai CEO vs. Sunwave Communications Co | Shanghai CEO vs. Tongyu Communication | Shanghai CEO vs. Hubei Forbon Technology | Shanghai CEO vs. Guangxi Wuzhou Communications |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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