Correlation Between China Construction and Simei Media
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By analyzing existing cross correlation between China Construction Bank and Simei Media Co, you can compare the effects of market volatilities on China Construction and Simei Media 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 Simei Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Simei Media.
Diversification Opportunities for China Construction and Simei Media
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Simei is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Simei Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simei Media 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 Simei Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simei Media has no effect on the direction of China Construction i.e., China Construction and Simei Media go up and down completely randomly.
Pair Corralation between China Construction and Simei Media
Assuming the 90 days trading horizon China Construction Bank is expected to under-perform the Simei Media. But the stock apears to be less risky and, when comparing its historical volatility, China Construction Bank is 5.17 times less risky than Simei Media. The stock trades about 0.0 of its potential returns per unit of risk. The Simei Media Co is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 561.00 in Simei Media Co on September 5, 2024 and sell it today you would earn a total of 60.00 from holding Simei Media Co or generate 10.7% 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. Simei Media Co
Performance |
| Timeline |
| China Construction Bank |
| Simei Media |
China Construction and Simei Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Simei Media
The main advantage of trading using opposite China Construction and Simei Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Simei Media 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 Simei Media will offset losses from the drop in Simei Media'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 |
| Simei Media vs. Industrial and Commercial | Simei Media vs. China Construction Bank | Simei Media vs. Bank of China | Simei Media vs. Agricultural Bank of |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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