Correlation Between Bank of China and Guangdong Xiongsu
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By analyzing existing cross correlation between Bank of China and Guangdong Xiongsu Technology, you can compare the effects of market volatilities on Bank of China and Guangdong Xiongsu 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 Guangdong Xiongsu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Guangdong Xiongsu.
Diversification Opportunities for Bank of China and Guangdong Xiongsu
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bank and Guangdong is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Guangdong Xiongsu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Xiongsu 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 Guangdong Xiongsu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Xiongsu has no effect on the direction of Bank of China i.e., Bank of China and Guangdong Xiongsu go up and down completely randomly.
Pair Corralation between Bank of China and Guangdong Xiongsu
Assuming the 90 days trading horizon Bank of China is expected to generate 0.29 times more return on investment than Guangdong Xiongsu. However, Bank of China is 3.4 times less risky than Guangdong Xiongsu. It trades about 0.19 of its potential returns per unit of risk. Guangdong Xiongsu Technology is currently generating about -0.02 per unit of risk. If you would invest 482.00 in Bank of China on September 1, 2024 and sell it today you would earn a total of 19.00 from holding Bank of China or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Guangdong Xiongsu Technology
Performance |
| Timeline |
| Bank of China |
| Guangdong Xiongsu |
Bank of China and Guangdong Xiongsu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Guangdong Xiongsu
The main advantage of trading using opposite Bank of China and Guangdong Xiongsu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Guangdong Xiongsu 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 Guangdong Xiongsu will offset losses from the drop in Guangdong Xiongsu's long position.| Bank of China vs. China Minmetals Rare | Bank of China vs. China Eastern Airlines | Bank of China vs. Metro Investment Development | Bank of China vs. Cultural Investment Holdings |
| Guangdong Xiongsu vs. Industrial and Commercial | Guangdong Xiongsu vs. Agricultural Bank of | Guangdong Xiongsu vs. China Construction Bank | Guangdong Xiongsu 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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