Correlation Between China Construction and Shandong Homey
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By analyzing existing cross correlation between China Construction Bank and Shandong Homey Aquatic, you can compare the effects of market volatilities on China Construction and Shandong Homey 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 Shandong Homey. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Shandong Homey.
Diversification Opportunities for China Construction and Shandong Homey
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Shandong is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Shandong Homey Aquatic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Homey Aquatic 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 Shandong Homey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Homey Aquatic has no effect on the direction of China Construction i.e., China Construction and Shandong Homey go up and down completely randomly.
Pair Corralation between China Construction and Shandong Homey
Assuming the 90 days trading horizon China Construction is expected to generate 36.22 times less return on investment than Shandong Homey. But when comparing it to its historical volatility, China Construction Bank is 6.71 times less risky than Shandong Homey. It trades about 0.04 of its potential returns per unit of risk. Shandong Homey Aquatic is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 194.00 in Shandong Homey Aquatic on August 30, 2024 and sell it today you would earn a total of 45.00 from holding Shandong Homey Aquatic or generate 23.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
China Construction Bank vs. Shandong Homey Aquatic
Performance |
| Timeline |
| China Construction Bank |
| Shandong Homey Aquatic |
China Construction and Shandong Homey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Shandong Homey
The main advantage of trading using opposite China Construction and Shandong Homey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Shandong Homey 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 Shandong Homey will offset losses from the drop in Shandong Homey's long position.| China Construction vs. Kweichow Moutai Co | China Construction vs. Shenzhen Mindray Bio Medical | China Construction vs. Jiangsu Pacific Quartz | China Construction vs. G bits Network Technology |
| Shandong Homey vs. Industrial and Commercial | Shandong Homey vs. China Construction Bank | Shandong Homey vs. Agricultural Bank of | Shandong Homey vs. Bank of China |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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