Correlation Between China Construction and Shanghai CEO
Specify exactly 2 symbols:
By analyzing existing cross correlation between China Construction Bank and Shanghai CEO Environmental, you can compare the effects of market volatilities on China Construction and Shanghai CEO 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 Shanghai CEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Shanghai CEO.
Diversification Opportunities for China Construction and Shanghai CEO
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Shanghai is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Shanghai CEO Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai CEO Environ 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 Shanghai CEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai CEO Environ has no effect on the direction of China Construction i.e., China Construction and Shanghai CEO go up and down completely randomly.
Pair Corralation between China Construction and Shanghai CEO
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.34 times more return on investment than Shanghai CEO. However, China Construction Bank is 2.91 times less risky than Shanghai CEO. It trades about 0.34 of its potential returns per unit of risk. Shanghai CEO Environmental is currently generating about 0.02 per unit of risk. If you would invest 790.00 in China Construction Bank on September 12, 2024 and sell it today you would earn a total of 47.00 from holding China Construction Bank or generate 5.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Shanghai CEO Environmental
Performance |
| Timeline |
| China Construction Bank |
| Shanghai CEO Environ |
China Construction and Shanghai CEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Shanghai CEO
The main advantage of trading using opposite China Construction and Shanghai CEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Shanghai CEO 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 Shanghai CEO will offset losses from the drop in Shanghai CEO'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 |
| Shanghai CEO vs. Agricultural Bank of | Shanghai CEO vs. Industrial and Commercial | Shanghai CEO vs. Bank of China | Shanghai CEO vs. PetroChina Co Ltd |
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.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |