Correlation Between Bank of China and Shanghai Shibei
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By analyzing existing cross correlation between Bank of China and Shanghai Shibei Hi Tech, you can compare the effects of market volatilities on Bank of China and Shanghai Shibei 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 Shanghai Shibei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Shanghai Shibei.
Diversification Opportunities for Bank of China and Shanghai Shibei
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Shanghai is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Shanghai Shibei Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shibei Hi 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 Shanghai Shibei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shibei Hi has no effect on the direction of Bank of China i.e., Bank of China and Shanghai Shibei go up and down completely randomly.
Pair Corralation between Bank of China and Shanghai Shibei
Assuming the 90 days trading horizon Bank of China is expected to generate 0.7 times more return on investment than Shanghai Shibei. However, Bank of China is 1.43 times less risky than Shanghai Shibei. It trades about 0.06 of its potential returns per unit of risk. Shanghai Shibei Hi Tech is currently generating about -0.1 per unit of risk. If you would invest 537.00 in Bank of China on November 3, 2024 and sell it today you would earn a total of 8.00 from holding Bank of China or generate 1.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Shanghai Shibei Hi Tech
Performance |
| Timeline |
| Bank of China |
| Shanghai Shibei Hi |
Bank of China and Shanghai Shibei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Shanghai Shibei
The main advantage of trading using opposite Bank of China and Shanghai Shibei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Shanghai Shibei 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 Shanghai Shibei will offset losses from the drop in Shanghai Shibei'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 |
| Shanghai Shibei vs. Zotye Automobile Co | Shanghai Shibei vs. Ningbo Fangzheng Automobile | Shanghai Shibei vs. CIMC Vehicles Co | Shanghai Shibei vs. Linewell Software Co |
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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