Correlation Between China State and Touchstone International
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By analyzing existing cross correlation between China State Construction and Touchstone International Medical, you can compare the effects of market volatilities on China State and Touchstone 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 Touchstone International. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Touchstone International.
Diversification Opportunities for China State and Touchstone International
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Touchstone is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Touchstone International Medic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone 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 Touchstone International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone International has no effect on the direction of China State i.e., China State and Touchstone International go up and down completely randomly.
Pair Corralation between China State and Touchstone International
Assuming the 90 days trading horizon China State Construction is expected to generate 0.72 times more return on investment than Touchstone International. However, China State Construction is 1.4 times less risky than Touchstone International. It trades about 0.01 of its potential returns per unit of risk. Touchstone International Medical is currently generating about 0.0 per unit of risk. If you would invest 563.00 in China State Construction on August 28, 2024 and sell it today you would earn a total of 26.00 from holding China State Construction or generate 4.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Touchstone International Medic
Performance |
| Timeline |
| China State Construction |
| Touchstone International |
China State and Touchstone International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Touchstone International
The main advantage of trading using opposite China State and Touchstone International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Touchstone 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 Touchstone International will offset losses from the drop in Touchstone International's long position.| China State vs. Ming Yang Smart | China State vs. 159681 | China State vs. 159005 | China State vs. Loctek Ergonomic Technology |
| Touchstone International vs. Bank of China | Touchstone International vs. Kweichow Moutai Co | Touchstone International vs. PetroChina Co Ltd | Touchstone 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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