Correlation Between China State and Xian International
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By analyzing existing cross correlation between China State Construction and Xian International Medical, you can compare the effects of market volatilities on China State and Xian International 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 State with a short position of Xian International. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Xian International.
Diversification Opportunities for China State and Xian International
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Xian is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Xian International Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xian International and China State 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 State Construction are associated (or correlated) with Xian International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xian International has no effect on the direction of China State i.e., China State and Xian International go up and down completely randomly.
Pair Corralation between China State and Xian International
Assuming the 90 days trading horizon China State Construction is expected to generate 0.69 times more return on investment than Xian International. However, China State Construction is 1.44 times less risky than Xian International. It trades about 0.01 of its potential returns per unit of risk. Xian International Medical is currently generating about -0.03 per unit of risk. If you would invest 592.00 in China State Construction on September 1, 2024 and sell it today you would earn a total of 6.00 from holding China State Construction or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Xian International Medical
Performance |
| Timeline |
| China State Construction |
| Xian International |
China State and Xian International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Xian International
The main advantage of trading using opposite China State and Xian International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Xian International 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 Xian International will offset losses from the drop in Xian International's long position.| China State vs. Hunan Investment Group | China State vs. Huaibei Mining Holdings | China State vs. Metro Investment Development | China State vs. Postal Savings Bank |
| Xian International vs. Bank of China | Xian International vs. Kweichow Moutai Co | Xian International vs. PetroChina Co Ltd | Xian International vs. Bank of 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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