Correlation Between China Construction and HanS Laser
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By analyzing existing cross correlation between China Construction Bank and HanS Laser Tech, you can compare the effects of market volatilities on China Construction and HanS Laser 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 HanS Laser. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and HanS Laser.
Diversification Opportunities for China Construction and HanS Laser
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and HanS is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and HanS Laser Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HanS Laser Tech 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 HanS Laser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HanS Laser Tech has no effect on the direction of China Construction i.e., China Construction and HanS Laser go up and down completely randomly.
Pair Corralation between China Construction and HanS Laser
Assuming the 90 days trading horizon China Construction is expected to generate 1.81 times less return on investment than HanS Laser. But when comparing it to its historical volatility, China Construction Bank is 1.74 times less risky than HanS Laser. It trades about 0.08 of its potential returns per unit of risk. HanS Laser Tech is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,047 in HanS Laser Tech on August 29, 2024 and sell it today you would earn a total of 521.00 from holding HanS Laser Tech or generate 25.45% 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. HanS Laser Tech
Performance |
| Timeline |
| China Construction Bank |
| HanS Laser Tech |
China Construction and HanS Laser Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and HanS Laser
The main advantage of trading using opposite China Construction and HanS Laser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, HanS Laser 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 HanS Laser will offset losses from the drop in HanS Laser's long position.| China Construction vs. Xinjiang Tianrun Dairy | China Construction vs. HaiXin Foods Co | China Construction vs. Juewei Food Co | China Construction vs. Suzhou Douson Drilling |
| HanS Laser vs. PetroChina Co Ltd | HanS Laser vs. China State Construction | HanS Laser vs. China Mobile Limited | HanS Laser vs. Industrial and Commercial |
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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