Correlation Between Bank of China and Xinjiang Tianrun
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By analyzing existing cross correlation between Bank of China and Xinjiang Tianrun Dairy, you can compare the effects of market volatilities on Bank of China and Xinjiang Tianrun 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 Xinjiang Tianrun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Xinjiang Tianrun.
Diversification Opportunities for Bank of China and Xinjiang Tianrun
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Bank and Xinjiang is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Xinjiang Tianrun Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Tianrun Dairy 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 Xinjiang Tianrun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Tianrun Dairy has no effect on the direction of Bank of China i.e., Bank of China and Xinjiang Tianrun go up and down completely randomly.
Pair Corralation between Bank of China and Xinjiang Tianrun
Assuming the 90 days trading horizon Bank of China is expected to generate 0.62 times more return on investment than Xinjiang Tianrun. However, Bank of China is 1.61 times less risky than Xinjiang Tianrun. It trades about 0.08 of its potential returns per unit of risk. Xinjiang Tianrun Dairy is currently generating about -0.04 per unit of risk. If you would invest 399.00 in Bank of China on September 2, 2024 and sell it today you would earn a total of 102.00 from holding Bank of China or generate 25.56% 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. Xinjiang Tianrun Dairy
Performance |
| Timeline |
| Bank of China |
| Xinjiang Tianrun Dairy |
Bank of China and Xinjiang Tianrun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Xinjiang Tianrun
The main advantage of trading using opposite Bank of China and Xinjiang Tianrun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Xinjiang Tianrun 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 Xinjiang Tianrun will offset losses from the drop in Xinjiang Tianrun's long position.| Bank of China vs. Marssenger Kitchenware Co | Bank of China vs. Thinkingdom Media Group | Bank of China vs. Hengdian Entertainment Co | Bank of China vs. Lander Sports Development |
| Xinjiang Tianrun vs. Jiangxi JDL Environmental | Xinjiang Tianrun vs. Jiugui Liquor Co | Xinjiang Tianrun vs. Guangzhou Tinci Materials | Xinjiang Tianrun vs. Tongxing Environmental Protection |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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