Correlation Between Bank of China and Jiangxi Sunshine
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By analyzing existing cross correlation between Bank of China and Jiangxi Sunshine Dairy, you can compare the effects of market volatilities on Bank of China and Jiangxi Sunshine 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 Jiangxi Sunshine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Jiangxi Sunshine.
Diversification Opportunities for Bank of China and Jiangxi Sunshine
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Jiangxi is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Jiangxi Sunshine Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Sunshine Dairy 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 Jiangxi Sunshine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Sunshine Dairy has no effect on the direction of Bank of China i.e., Bank of China and Jiangxi Sunshine go up and down completely randomly.
Pair Corralation between Bank of China and Jiangxi Sunshine
Assuming the 90 days trading horizon Bank of China is expected to generate 0.51 times more return on investment than Jiangxi Sunshine. However, Bank of China is 1.95 times less risky than Jiangxi Sunshine. It trades about 0.09 of its potential returns per unit of risk. Jiangxi Sunshine Dairy is currently generating about 0.02 per unit of risk. If you would invest 397.00 in Bank of China on September 14, 2024 and sell it today you would earn a total of 123.00 from holding Bank of China or generate 30.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Jiangxi Sunshine Dairy
Performance |
| Timeline |
| Bank of China |
| Jiangxi Sunshine Dairy |
Bank of China and Jiangxi Sunshine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Jiangxi Sunshine
The main advantage of trading using opposite Bank of China and Jiangxi Sunshine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Jiangxi Sunshine 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 Jiangxi Sunshine will offset losses from the drop in Jiangxi Sunshine's long position.| Bank of China vs. Industrial Bank Co | Bank of China vs. GRG Banking Equipment | Bank of China vs. Central Plains Environment | Bank of China vs. Guosheng Financial Holding |
| Jiangxi Sunshine vs. Sinosteel Engineering and | Jiangxi Sunshine vs. Shenwu Energy Saving | Jiangxi Sunshine vs. Ping An Insurance | Jiangxi Sunshine vs. Easyhome New Retail |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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