Correlation Between China Construction and Jiangsu GDK
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By analyzing existing cross correlation between China Construction Bank and Jiangsu GDK Biotechnology, you can compare the effects of market volatilities on China Construction and Jiangsu GDK 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 Jiangsu GDK. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Jiangsu GDK.
Diversification Opportunities for China Construction and Jiangsu GDK
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and Jiangsu is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Jiangsu GDK Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu GDK Biotechnology 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 Jiangsu GDK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu GDK Biotechnology has no effect on the direction of China Construction i.e., China Construction and Jiangsu GDK go up and down completely randomly.
Pair Corralation between China Construction and Jiangsu GDK
Assuming the 90 days trading horizon China Construction Bank is expected to generate 0.36 times more return on investment than Jiangsu GDK. However, China Construction Bank is 2.75 times less risky than Jiangsu GDK. It trades about 0.07 of its potential returns per unit of risk. Jiangsu GDK Biotechnology is currently generating about -0.05 per unit of risk. If you would invest 559.00 in China Construction Bank on December 4, 2024 and sell it today you would earn a total of 291.00 from holding China Construction Bank or generate 52.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Jiangsu GDK Biotechnology
Performance |
| Timeline |
| China Construction Bank |
| Jiangsu GDK Biotechnology |
China Construction and Jiangsu GDK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Jiangsu GDK
The main advantage of trading using opposite China Construction and Jiangsu GDK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Jiangsu GDK 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 Jiangsu GDK will offset losses from the drop in Jiangsu GDK's long position.| China Construction vs. Sinofibers Technology Co | China Construction vs. Keda Clean Energy | China Construction vs. Cansino Biologics | China Construction vs. Tianjin Ruixin Technology |
| Jiangsu GDK vs. Nanxing Furniture Machinery | Jiangsu GDK vs. Northking Information Technology | Jiangsu GDK vs. Sinofibers Technology Co | Jiangsu GDK vs. iSoftStone Information 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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