Correlation Between China Everbright and Shenzhen Topway
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By analyzing existing cross correlation between China Everbright Bank and Shenzhen Topway Video, you can compare the effects of market volatilities on China Everbright and Shenzhen Topway 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 Topway. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Everbright and Shenzhen Topway.
Diversification Opportunities for China Everbright and Shenzhen Topway
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Shenzhen is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding China Everbright Bank and Shenzhen Topway Video in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Topway Video 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 Topway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Topway Video has no effect on the direction of China Everbright i.e., China Everbright and Shenzhen Topway go up and down completely randomly.
Pair Corralation between China Everbright and Shenzhen Topway
Assuming the 90 days trading horizon China Everbright Bank is expected to generate 0.44 times more return on investment than Shenzhen Topway. However, China Everbright Bank is 2.25 times less risky than Shenzhen Topway. It trades about -0.1 of its potential returns per unit of risk. Shenzhen Topway Video is currently generating about -0.53 per unit of risk. If you would invest 373.00 in China Everbright Bank on October 16, 2024 and sell it today you would lose (12.00) from holding China Everbright Bank or give up 3.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Everbright Bank vs. Shenzhen Topway Video
Performance |
| Timeline |
| China Everbright Bank |
| Shenzhen Topway Video |
China Everbright and Shenzhen Topway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Everbright and Shenzhen Topway
The main advantage of trading using opposite China Everbright and Shenzhen Topway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Everbright position performs unexpectedly, Shenzhen Topway 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 Topway will offset losses from the drop in Shenzhen Topway's long position.| China Everbright vs. Fiberhome Telecommunication Technologies | China Everbright vs. Wintao Communications Co | China Everbright vs. Tongyu Communication | China Everbright vs. Runjian Communication Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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