Correlation Between China Construction and Dongrui Food
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By analyzing existing cross correlation between China Construction Bank and Dongrui Food Group, you can compare the effects of market volatilities on China Construction and Dongrui Food 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 Construction with a short position of Dongrui Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Dongrui Food.
Diversification Opportunities for China Construction and Dongrui Food
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Dongrui is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Dongrui Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongrui Food Group and China Construction 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 Construction Bank are associated (or correlated) with Dongrui Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongrui Food Group has no effect on the direction of China Construction i.e., China Construction and Dongrui Food go up and down completely randomly.
Pair Corralation between China Construction and Dongrui Food
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.5 times more return on investment than Dongrui Food. However, China Construction Bank is 2.0 times less risky than Dongrui Food. It trades about 0.08 of its potential returns per unit of risk. Dongrui Food Group is currently generating about -0.04 per unit of risk. If you would invest 522.00 in China Construction Bank on September 5, 2024 and sell it today you would earn a total of 285.00 from holding China Construction Bank or generate 54.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Dongrui Food Group
Performance |
| Timeline |
| China Construction Bank |
| Dongrui Food Group |
China Construction and Dongrui Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Dongrui Food
The main advantage of trading using opposite China Construction and Dongrui Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Dongrui Food 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 Dongrui Food will offset losses from the drop in Dongrui Food's long position.| China Construction vs. Beijing Sanyuan Foods | China Construction vs. By health | China Construction vs. Everjoy Health Group | China Construction vs. Shandong Huifa Foodstuff |
| Dongrui Food vs. Agricultural Bank of | Dongrui Food vs. Industrial and Commercial | Dongrui Food vs. Bank of China | Dongrui Food vs. China Construction Bank |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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