Correlation Between Bank of China and Pharmaron Beijing
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By analyzing existing cross correlation between Bank of China and Pharmaron Beijing Co, you can compare the effects of market volatilities on Bank of China and Pharmaron Beijing 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 Pharmaron Beijing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Pharmaron Beijing.
Diversification Opportunities for Bank of China and Pharmaron Beijing
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bank and Pharmaron is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Pharmaron Beijing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharmaron Beijing 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 Pharmaron Beijing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharmaron Beijing has no effect on the direction of Bank of China i.e., Bank of China and Pharmaron Beijing go up and down completely randomly.
Pair Corralation between Bank of China and Pharmaron Beijing
Assuming the 90 days trading horizon Bank of China is expected to generate 0.37 times more return on investment than Pharmaron Beijing. However, Bank of China is 2.72 times less risky than Pharmaron Beijing. It trades about 0.2 of its potential returns per unit of risk. Pharmaron Beijing Co is currently generating about -0.14 per unit of risk. If you would invest 483.00 in Bank of China on August 31, 2024 and sell it today you would earn a total of 20.00 from holding Bank of China or generate 4.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bank of China vs. Pharmaron Beijing Co
Performance |
| Timeline |
| Bank of China |
| Pharmaron Beijing |
Bank of China and Pharmaron Beijing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Pharmaron Beijing
The main advantage of trading using opposite Bank of China and Pharmaron Beijing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Pharmaron Beijing 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 Pharmaron Beijing will offset losses from the drop in Pharmaron Beijing's long position.| Bank of China vs. Tianjin Hi Tech Development | Bank of China vs. Dazhong Transportation Group | Bank of China vs. Hubeiyichang Transportation Group | Bank of China vs. Guangdong Shenglu Telecommunication |
| Pharmaron Beijing vs. Jiangsu Yanghe Brewery | Pharmaron Beijing vs. Gome Telecom Equipment | Pharmaron Beijing vs. Tongyu Communication | Pharmaron Beijing vs. Kunwu Jiuding Investment |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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