Correlation Between China State and Vanfund Urban
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By analyzing existing cross correlation between China State Construction and Vanfund Urban Investment, you can compare the effects of market volatilities on China State and Vanfund Urban 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 Vanfund Urban. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Vanfund Urban.
Diversification Opportunities for China State and Vanfund Urban
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Vanfund is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Vanfund Urban Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanfund Urban Investment 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 Vanfund Urban. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanfund Urban Investment has no effect on the direction of China State i.e., China State and Vanfund Urban go up and down completely randomly.
Pair Corralation between China State and Vanfund Urban
Assuming the 90 days trading horizon China State Construction is expected to under-perform the Vanfund Urban. But the stock apears to be less risky and, when comparing its historical volatility, China State Construction is 2.18 times less risky than Vanfund Urban. The stock trades about -0.11 of its potential returns per unit of risk. The Vanfund Urban Investment is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 494.00 in Vanfund Urban Investment on November 27, 2024 and sell it today you would earn a total of 29.00 from holding Vanfund Urban Investment or generate 5.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Vanfund Urban Investment
Performance |
| Timeline |
| China State Construction |
| Vanfund Urban Investment |
China State and Vanfund Urban Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Vanfund Urban
The main advantage of trading using opposite China State and Vanfund Urban positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Vanfund Urban 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 Vanfund Urban will offset losses from the drop in Vanfund Urban's long position.| China State vs. TianJin 712 Communication | China State vs. INKON Life Technology | China State vs. Juneyao Airlines | China State vs. Elec Tech International Co |
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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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