Correlation Between China Construction and Suofeiya Home
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By analyzing existing cross correlation between China Construction Bank and Suofeiya Home Collection, you can compare the effects of market volatilities on China Construction and Suofeiya Home 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 Suofeiya Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Suofeiya Home.
Diversification Opportunities for China Construction and Suofeiya Home
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Suofeiya is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Suofeiya Home Collection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suofeiya Home Collection 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 Suofeiya Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suofeiya Home Collection has no effect on the direction of China Construction i.e., China Construction and Suofeiya Home go up and down completely randomly.
Pair Corralation between China Construction and Suofeiya Home
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.31 times more return on investment than Suofeiya Home. However, China Construction Bank is 3.23 times less risky than Suofeiya Home. It trades about 0.34 of its potential returns per unit of risk. Suofeiya Home Collection is currently generating about 0.02 per unit of risk. If you would invest 790.00 in China Construction Bank on September 12, 2024 and sell it today you would earn a total of 47.00 from holding China Construction Bank or generate 5.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
China Construction Bank vs. Suofeiya Home Collection
Performance |
| Timeline |
| China Construction Bank |
| Suofeiya Home Collection |
China Construction and Suofeiya Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Suofeiya Home
The main advantage of trading using opposite China Construction and Suofeiya Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Suofeiya Home 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 Suofeiya Home will offset losses from the drop in Suofeiya Home's long position.| China Construction vs. China Petroleum Chemical | China Construction vs. PetroChina Co Ltd | China Construction vs. China Mobile Limited | China Construction vs. Industrial and Commercial |
| Suofeiya Home vs. Lutian Machinery Co | Suofeiya Home vs. PetroChina Co Ltd | Suofeiya Home vs. Bank of China | Suofeiya Home vs. Gansu Jiu Steel |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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