Correlation Between China Construction and Panda Financial
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By analyzing existing cross correlation between China Construction Bank and Panda Financial Holding, you can compare the effects of market volatilities on China Construction and Panda Financial 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 Panda Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Panda Financial.
Diversification Opportunities for China Construction and Panda Financial
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and Panda is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Panda Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panda Financial Holding 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 Panda Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panda Financial Holding has no effect on the direction of China Construction i.e., China Construction and Panda Financial go up and down completely randomly.
Pair Corralation between China Construction and Panda Financial
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.43 times more return on investment than Panda Financial. However, China Construction Bank is 2.32 times less risky than Panda Financial. It trades about 0.09 of its potential returns per unit of risk. Panda Financial Holding is currently generating about 0.03 per unit of risk. If you would invest 642.00 in China Construction Bank on September 12, 2024 and sell it today you would earn a total of 195.00 from holding China Construction Bank or generate 30.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Panda Financial Holding
Performance |
| Timeline |
| China Construction Bank |
| Panda Financial Holding |
China Construction and Panda Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Panda Financial
The main advantage of trading using opposite China Construction and Panda Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Panda Financial 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 Panda Financial will offset losses from the drop in Panda Financial'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 |
| Panda Financial vs. China Petroleum Chemical | Panda Financial vs. PetroChina Co Ltd | Panda Financial vs. China Mobile Limited | Panda Financial 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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