Correlation Between Bank of China and China Minmetals
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By analyzing existing cross correlation between Bank of China and China Minmetals Rare, you can compare the effects of market volatilities on Bank of China and China Minmetals 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 China Minmetals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and China Minmetals.
Diversification Opportunities for Bank of China and China Minmetals
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and China is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and China Minmetals Rare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Minmetals Rare 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 China Minmetals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Minmetals Rare has no effect on the direction of Bank of China i.e., Bank of China and China Minmetals go up and down completely randomly.
Pair Corralation between Bank of China and China Minmetals
Assuming the 90 days trading horizon Bank of China is expected to generate 0.48 times more return on investment than China Minmetals. However, Bank of China is 2.09 times less risky than China Minmetals. It trades about 0.09 of its potential returns per unit of risk. China Minmetals Rare is currently generating about 0.02 per unit of risk. If you would invest 369.00 in Bank of China on September 3, 2024 and sell it today you would earn a total of 132.00 from holding Bank of China or generate 35.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. China Minmetals Rare
Performance |
| Timeline |
| Bank of China |
| China Minmetals Rare |
Bank of China and China Minmetals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and China Minmetals
The main advantage of trading using opposite Bank of China and China Minmetals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, China Minmetals 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 China Minmetals will offset losses from the drop in China Minmetals' long position.| Bank of China vs. Tongyu Communication | Bank of China vs. Guangzhou Haige Communications | Bank of China vs. Everdisplay Optronics Shanghai | Bank of China vs. Wuhan Yangtze Communication |
| China Minmetals vs. China Resources Microelectronics | China Minmetals vs. China Mobile Limited | China Minmetals vs. China National Electric | China Minmetals vs. China International Travel |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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