Correlation Between Bank of China and Panda Dairy Corp
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By analyzing existing cross correlation between Bank of China and Panda Dairy Corp, you can compare the effects of market volatilities on Bank of China and Panda Dairy Corp 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 Panda Dairy Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Panda Dairy Corp.
Diversification Opportunities for Bank of China and Panda Dairy Corp
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bank and Panda is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Panda Dairy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panda Dairy Corp 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 Panda Dairy Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panda Dairy Corp has no effect on the direction of Bank of China i.e., Bank of China and Panda Dairy Corp go up and down completely randomly.
Pair Corralation between Bank of China and Panda Dairy Corp
Assuming the 90 days trading horizon Bank of China is expected to generate 0.39 times more return on investment than Panda Dairy Corp. However, Bank of China is 2.55 times less risky than Panda Dairy Corp. It trades about 0.06 of its potential returns per unit of risk. Panda Dairy Corp is currently generating about 0.02 per unit of risk. If you would invest 391.00 in Bank of China on August 31, 2024 and sell it today you would earn a total of 110.00 from holding Bank of China or generate 28.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Bank of China vs. Panda Dairy Corp
Performance |
| Timeline |
| Bank of China |
| Panda Dairy Corp |
Bank of China and Panda Dairy Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Panda Dairy Corp
The main advantage of trading using opposite Bank of China and Panda Dairy Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Panda Dairy Corp 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 Panda Dairy Corp will offset losses from the drop in Panda Dairy Corp'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 |
| Panda Dairy Corp vs. Lutian Machinery Co | Panda Dairy Corp vs. PetroChina Co Ltd | Panda Dairy Corp vs. Bank of China | Panda Dairy Corp vs. Gansu Jiu Steel |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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