Correlation Between Bank of China and Huaxia Fund
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By analyzing existing cross correlation between Bank of China and Huaxia Fund Management, you can compare the effects of market volatilities on Bank of China and Huaxia Fund 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 Huaxia Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Huaxia Fund.
Diversification Opportunities for Bank of China and Huaxia Fund
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bank and Huaxia is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Huaxia Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huaxia Fund Management 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 Huaxia Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huaxia Fund Management has no effect on the direction of Bank of China i.e., Bank of China and Huaxia Fund go up and down completely randomly.
Pair Corralation between Bank of China and Huaxia Fund
Assuming the 90 days trading horizon Bank of China is expected to generate 1.83 times less return on investment than Huaxia Fund. In addition to that, Bank of China is 1.55 times more volatile than Huaxia Fund Management. It trades about 0.06 of its total potential returns per unit of risk. Huaxia Fund Management is currently generating about 0.17 per unit of volatility. If you would invest 299.00 in Huaxia Fund Management on November 3, 2024 and sell it today you would earn a total of 9.00 from holding Huaxia Fund Management or generate 3.01% 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. Huaxia Fund Management
Performance |
| Timeline |
| Bank of China |
| Huaxia Fund Management |
Bank of China and Huaxia Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Huaxia Fund
The main advantage of trading using opposite Bank of China and Huaxia Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Huaxia Fund 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 Huaxia Fund will offset losses from the drop in Huaxia Fund's long position.| Bank of China vs. Zoje Resources Investment | Bank of China vs. Chengdu Xingrong Investment | Bank of China vs. Zbit Semiconductor A | Bank of China vs. Southchip Semiconductor Technology |
| Huaxia Fund vs. Fuzhou Rockchip Electronics | Huaxia Fund vs. Tonghua Grape Wine | Huaxia Fund vs. Nantong Haixing Electronics | Huaxia Fund vs. Cabio Biotech Wuhan |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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