Correlation Between China Everbright and Shenzhen Clou
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By analyzing existing cross correlation between China Everbright Bank and Shenzhen Clou Electronics, you can compare the effects of market volatilities on China Everbright and Shenzhen Clou 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 Everbright with a short position of Shenzhen Clou. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Everbright and Shenzhen Clou.
Diversification Opportunities for China Everbright and Shenzhen Clou
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Shenzhen is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding China Everbright Bank and Shenzhen Clou Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Clou Electronics and China Everbright 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 Everbright Bank are associated (or correlated) with Shenzhen Clou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Clou Electronics has no effect on the direction of China Everbright i.e., China Everbright and Shenzhen Clou go up and down completely randomly.
Pair Corralation between China Everbright and Shenzhen Clou
Assuming the 90 days trading horizon China Everbright Bank is expected to generate 0.48 times more return on investment than Shenzhen Clou. However, China Everbright Bank is 2.07 times less risky than Shenzhen Clou. It trades about 0.04 of its potential returns per unit of risk. Shenzhen Clou Electronics is currently generating about -0.06 per unit of risk. If you would invest 291.00 in China Everbright Bank on October 11, 2024 and sell it today you would earn a total of 77.00 from holding China Everbright Bank or generate 26.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Everbright Bank vs. Shenzhen Clou Electronics
Performance |
| Timeline |
| China Everbright Bank |
| Shenzhen Clou Electronics |
China Everbright and Shenzhen Clou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Everbright and Shenzhen Clou
The main advantage of trading using opposite China Everbright and Shenzhen Clou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Everbright position performs unexpectedly, Shenzhen Clou 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 Shenzhen Clou will offset losses from the drop in Shenzhen Clou's long position.| China Everbright vs. Penyao Environmental Protection | China Everbright vs. Baoshan Iron Steel | China Everbright vs. Hangzhou Guotai Environmental | China Everbright vs. Porton Fine Chemicals |
| Shenzhen Clou vs. China Everbright Bank | Shenzhen Clou vs. Shenzhen Kexin Communication | Shenzhen Clou vs. SUNSEA Telecommunications Co | Shenzhen Clou vs. Telling Telecommunication Holding |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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