Correlation Between China Everbright and Wuhan Yangtze
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By analyzing existing cross correlation between China Everbright Bank and Wuhan Yangtze Communication, you can compare the effects of market volatilities on China Everbright and Wuhan Yangtze 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 Wuhan Yangtze. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Everbright and Wuhan Yangtze.
Diversification Opportunities for China Everbright and Wuhan Yangtze
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Wuhan is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding China Everbright Bank and Wuhan Yangtze Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuhan Yangtze Commun 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 Wuhan Yangtze. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuhan Yangtze Commun has no effect on the direction of China Everbright i.e., China Everbright and Wuhan Yangtze go up and down completely randomly.
Pair Corralation between China Everbright and Wuhan Yangtze
Assuming the 90 days trading horizon China Everbright Bank is expected to generate 0.44 times more return on investment than Wuhan Yangtze. However, China Everbright Bank is 2.27 times less risky than Wuhan Yangtze. It trades about -0.03 of its potential returns per unit of risk. Wuhan Yangtze Communication is currently generating about -0.26 per unit of risk. If you would invest 373.00 in China Everbright Bank on October 17, 2024 and sell it today you would lose (4.00) from holding China Everbright Bank or give up 1.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Everbright Bank vs. Wuhan Yangtze Communication
Performance |
| Timeline |
| China Everbright Bank |
| Wuhan Yangtze Commun |
China Everbright and Wuhan Yangtze Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Everbright and Wuhan Yangtze
The main advantage of trading using opposite China Everbright and Wuhan Yangtze positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Everbright position performs unexpectedly, Wuhan Yangtze 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 Wuhan Yangtze will offset losses from the drop in Wuhan Yangtze's long position.| China Everbright vs. Ningbo MedicalSystem Biotechnology | China Everbright vs. Shandong Sanyuan Biotechnology | China Everbright vs. Kuang Chi Technologies | China Everbright vs. Eastern Air Logistics |
| Wuhan Yangtze vs. Shenwu Energy Saving | Wuhan Yangtze vs. China Everbright Bank | Wuhan Yangtze vs. Metro Investment Development | Wuhan Yangtze vs. Nuode Investment 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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