Correlation Between China Construction and Sunny Loan
Specify exactly 2 symbols:
By analyzing existing cross correlation between China Construction Bank and Sunny Loan Top, you can compare the effects of market volatilities on China Construction and Sunny Loan 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 Sunny Loan. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Sunny Loan.
Diversification Opportunities for China Construction and Sunny Loan
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Sunny is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Sunny Loan Top in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Loan Top 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 Sunny Loan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Loan Top has no effect on the direction of China Construction i.e., China Construction and Sunny Loan go up and down completely randomly.
Pair Corralation between China Construction and Sunny Loan
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.27 times more return on investment than Sunny Loan. However, China Construction Bank is 3.7 times less risky than Sunny Loan. It trades about 0.04 of its potential returns per unit of risk. Sunny Loan Top is currently generating about -0.11 per unit of risk. If you would invest 793.00 in China Construction Bank on September 1, 2024 and sell it today you would earn a total of 5.00 from holding China Construction Bank or generate 0.63% 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. Sunny Loan Top
Performance |
| Timeline |
| China Construction Bank |
| Sunny Loan Top |
China Construction and Sunny Loan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Sunny Loan
The main advantage of trading using opposite China Construction and Sunny Loan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Sunny Loan 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 Sunny Loan will offset losses from the drop in Sunny Loan's long position.The idea behind China Construction Bank and Sunny Loan Top pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Sunny Loan vs. Elite Color Environmental | Sunny Loan vs. Shenzhen MYS Environmental | Sunny Loan vs. Chengtun Mining Group | Sunny Loan vs. Ye Chiu Metal |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |