Correlation Between China Construction and Zhejiang Huayou
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By analyzing existing cross correlation between China Construction Bank and Zhejiang Huayou Cobalt, you can compare the effects of market volatilities on China Construction and Zhejiang Huayou 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 Zhejiang Huayou. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Zhejiang Huayou.
Diversification Opportunities for China Construction and Zhejiang Huayou
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and Zhejiang is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Zhejiang Huayou Cobalt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Huayou Cobalt 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 Zhejiang Huayou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Huayou Cobalt has no effect on the direction of China Construction i.e., China Construction and Zhejiang Huayou go up and down completely randomly.
Pair Corralation between China Construction and Zhejiang Huayou
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.49 times more return on investment than Zhejiang Huayou. However, China Construction Bank is 2.03 times less risky than Zhejiang Huayou. It trades about 0.08 of its potential returns per unit of risk. Zhejiang Huayou Cobalt is currently generating about -0.05 per unit of risk. If you would invest 529.00 in China Construction Bank on October 16, 2024 and sell it today you would earn a total of 300.00 from holding China Construction Bank or generate 56.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Zhejiang Huayou Cobalt
Performance |
| Timeline |
| China Construction Bank |
| Zhejiang Huayou Cobalt |
China Construction and Zhejiang Huayou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Zhejiang Huayou
The main advantage of trading using opposite China Construction and Zhejiang Huayou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Zhejiang Huayou 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 Zhejiang Huayou will offset losses from the drop in Zhejiang Huayou's long position.| China Construction vs. Jilin Chemical Fibre | China Construction vs. Liuzhou Chemical Industry | China Construction vs. Hainan Haiqi Transportation | China Construction vs. Longxing Chemical Stock |
| Zhejiang Huayou vs. Zijin Mining Group | Zhejiang Huayou vs. Wanhua Chemical Group | Zhejiang Huayou vs. Baoshan Iron Steel | Zhejiang Huayou vs. Shandong Gold Mining |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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