Correlation Between China Construction and Guangzhou Risong
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By analyzing existing cross correlation between China Construction Bank and Guangzhou Risong Intelligent, you can compare the effects of market volatilities on China Construction and Guangzhou Risong 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 Guangzhou Risong. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Guangzhou Risong.
Diversification Opportunities for China Construction and Guangzhou Risong
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Guangzhou is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Guangzhou Risong Intelligent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Risong Int 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 Guangzhou Risong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Risong Int has no effect on the direction of China Construction i.e., China Construction and Guangzhou Risong go up and down completely randomly.
Pair Corralation between China Construction and Guangzhou Risong
Assuming the 90 days trading horizon China Construction Bank is expected to under-perform the Guangzhou Risong. But the stock apears to be less risky and, when comparing its historical volatility, China Construction Bank is 2.46 times less risky than Guangzhou Risong. The stock trades about -0.01 of its potential returns per unit of risk. The Guangzhou Risong Intelligent is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,512 in Guangzhou Risong Intelligent on November 3, 2024 and sell it today you would earn a total of 226.00 from holding Guangzhou Risong Intelligent or generate 6.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Guangzhou Risong Intelligent
Performance |
| Timeline |
| China Construction Bank |
| Guangzhou Risong Int |
China Construction and Guangzhou Risong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Guangzhou Risong
The main advantage of trading using opposite China Construction and Guangzhou Risong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Guangzhou Risong 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 Guangzhou Risong will offset losses from the drop in Guangzhou Risong's long position.| China Construction vs. Guangdong Liantai Environmental | China Construction vs. Shenzhen MYS Environmental | China Construction vs. Baoshan Iron Steel | China Construction vs. Holitech Technology Co |
| Guangzhou Risong vs. Guangzhou Dongfang Hotel | Guangzhou Risong vs. Touchstone International Medical | Guangzhou Risong vs. Huatian Hotel Group | Guangzhou Risong vs. Kontour Medical Technology |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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