Correlation Between China State and Wonders Information
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By analyzing existing cross correlation between China State Construction and Wonders Information, you can compare the effects of market volatilities on China State and Wonders Information 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 Wonders Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Wonders Information.
Diversification Opportunities for China State and Wonders Information
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Wonders is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Wonders Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonders Information 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 Wonders Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonders Information has no effect on the direction of China State i.e., China State and Wonders Information go up and down completely randomly.
Pair Corralation between China State and Wonders Information
Assuming the 90 days trading horizon China State is expected to generate 2.18 times less return on investment than Wonders Information. But when comparing it to its historical volatility, China State Construction is 2.2 times less risky than Wonders Information. It trades about 0.02 of its potential returns per unit of risk. Wonders Information is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 985.00 in Wonders Information on September 2, 2024 and sell it today you would lose (27.00) from holding Wonders Information or give up 2.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Wonders Information
Performance |
| Timeline |
| China State Construction |
| Wonders Information |
China State and Wonders Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Wonders Information
The main advantage of trading using opposite China State and Wonders Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Wonders Information 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 Wonders Information will offset losses from the drop in Wonders Information's long position.| China State vs. 159681 | China State vs. 159005 | China State vs. Loctek Ergonomic Technology | China State vs. 516220 |
| Wonders Information vs. China Petroleum Chemical | Wonders Information vs. PetroChina Co Ltd | Wonders Information vs. China State Construction | Wonders Information vs. China Railway Group |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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