Correlation Between China Construction and Xingguang Agricultural
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By analyzing existing cross correlation between China Construction Bank and Xingguang Agricultural Mach, you can compare the effects of market volatilities on China Construction and Xingguang Agricultural 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 Xingguang Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Xingguang Agricultural.
Diversification Opportunities for China Construction and Xingguang Agricultural
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Xingguang is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Xingguang Agricultural Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingguang Agricultural 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 Xingguang Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xingguang Agricultural has no effect on the direction of China Construction i.e., China Construction and Xingguang Agricultural go up and down completely randomly.
Pair Corralation between China Construction and Xingguang Agricultural
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.44 times more return on investment than Xingguang Agricultural. However, China Construction Bank is 2.27 times less risky than Xingguang Agricultural. It trades about -0.14 of its potential returns per unit of risk. Xingguang Agricultural Mach is currently generating about -0.29 per unit of risk. If you would invest 862.00 in China Construction Bank on October 24, 2024 and sell it today you would lose (35.00) from holding China Construction Bank or give up 4.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Xingguang Agricultural Mach
Performance |
| Timeline |
| China Construction Bank |
| Xingguang Agricultural |
China Construction and Xingguang Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Xingguang Agricultural
The main advantage of trading using opposite China Construction and Xingguang Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Xingguang Agricultural 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 Xingguang Agricultural will offset losses from the drop in Xingguang Agricultural's long position.| China Construction vs. Xinjiang Baodi Mining | China Construction vs. Sihui Fuji Electronics | China Construction vs. Techshine Electronics Co | China Construction vs. Shengda Mining Co |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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