Correlation Between China State and V V
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By analyzing existing cross correlation between China State Construction and V V Food, you can compare the effects of market volatilities on China State and V V 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 V V. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and V V.
Diversification Opportunities for China State and V V
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and 600300 is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and V V Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V V Food 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 V V. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V V Food has no effect on the direction of China State i.e., China State and V V go up and down completely randomly.
Pair Corralation between China State and V V
Assuming the 90 days trading horizon China State Construction is expected to under-perform the V V. In addition to that, China State is 1.11 times more volatile than V V Food. It trades about -0.01 of its total potential returns per unit of risk. V V Food is currently generating about 0.14 per unit of volatility. If you would invest 287.00 in V V Food on August 31, 2024 and sell it today you would earn a total of 15.00 from holding V V Food or generate 5.23% 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. V V Food
Performance |
| Timeline |
| China State Construction |
| V V Food |
China State and V V Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and V V
The main advantage of trading using opposite China State and V V positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, V V 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 V V will offset losses from the drop in V V's long position.| China State vs. Guangdong Wens Foodstuff | China State vs. Great Sun Foods Co | China State vs. Tianjin Pengling Rubber | China State vs. Suzhou Xingye Material |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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