Correlation Between Bank of China and Jiangsu Jinling
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By analyzing existing cross correlation between Bank of China and Jiangsu Jinling Sports, you can compare the effects of market volatilities on Bank of China and Jiangsu Jinling 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 Jiangsu Jinling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Jiangsu Jinling.
Diversification Opportunities for Bank of China and Jiangsu Jinling
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Jiangsu is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Jiangsu Jinling Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Jinling Sports 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 Jiangsu Jinling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Jinling Sports has no effect on the direction of Bank of China i.e., Bank of China and Jiangsu Jinling go up and down completely randomly.
Pair Corralation between Bank of China and Jiangsu Jinling
Assuming the 90 days trading horizon Bank of China is expected to generate 0.39 times more return on investment than Jiangsu Jinling. However, Bank of China is 2.57 times less risky than Jiangsu Jinling. It trades about 0.33 of its potential returns per unit of risk. Jiangsu Jinling Sports is currently generating about 0.1 per unit of risk. If you would invest 479.00 in Bank of China on September 13, 2024 and sell it today you would earn a total of 34.00 from holding Bank of China or generate 7.1% 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. Jiangsu Jinling Sports
Performance |
| Timeline |
| Bank of China |
| Jiangsu Jinling Sports |
Bank of China and Jiangsu Jinling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Jiangsu Jinling
The main advantage of trading using opposite Bank of China and Jiangsu Jinling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Jiangsu Jinling 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 Jinling will offset losses from the drop in Jiangsu Jinling's long position.| Bank of China vs. AUPU Home Style | Bank of China vs. HaiXin Foods Co | Bank of China vs. JuneYao Dairy Co | Bank of China vs. Zhengzhou Qianweiyangchu Food |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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