Correlation Between Bank of China and Zhongshan Public
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By analyzing existing cross correlation between Bank of China and Zhongshan Public Utilities, you can compare the effects of market volatilities on Bank of China and Zhongshan Public 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 Bank of China with a short position of Zhongshan Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Zhongshan Public.
Diversification Opportunities for Bank of China and Zhongshan Public
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Zhongshan is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Zhongshan Public Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongshan Public Uti and Bank of China 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 Bank of China are associated (or correlated) with Zhongshan Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongshan Public Uti has no effect on the direction of Bank of China i.e., Bank of China and Zhongshan Public go up and down completely randomly.
Pair Corralation between Bank of China and Zhongshan Public
Assuming the 90 days trading horizon Bank of China is expected to generate 0.9 times more return on investment than Zhongshan Public. However, Bank of China is 1.11 times less risky than Zhongshan Public. It trades about -0.1 of its potential returns per unit of risk. Zhongshan Public Utilities is currently generating about -0.13 per unit of risk. If you would invest 551.00 in Bank of China on October 26, 2024 and sell it today you would lose (17.00) from holding Bank of China or give up 3.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Zhongshan Public Utilities
Performance |
| Timeline |
| Bank of China |
| Zhongshan Public Uti |
Bank of China and Zhongshan Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Zhongshan Public
The main advantage of trading using opposite Bank of China and Zhongshan Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Zhongshan Public 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 Zhongshan Public will offset losses from the drop in Zhongshan Public's long position.| Bank of China vs. Harbin Air Conditioning | Bank of China vs. Jinhui Liquor Co | Bank of China vs. MayAir Technology Co | Bank of China vs. Digiwin Software Co |
| Zhongshan Public vs. Industrial and Commercial | Zhongshan Public vs. China Construction Bank | Zhongshan Public vs. Agricultural Bank of | Zhongshan Public vs. Bank of China |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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