Correlation Between Bank of China and Chongqing Gas
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By analyzing existing cross correlation between Bank of China and Chongqing Gas Grp, you can compare the effects of market volatilities on Bank of China and Chongqing Gas 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 Chongqing Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Chongqing Gas.
Diversification Opportunities for Bank of China and Chongqing Gas
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Chongqing is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Chongqing Gas Grp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Gas Grp 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 Chongqing Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Gas Grp has no effect on the direction of Bank of China i.e., Bank of China and Chongqing Gas go up and down completely randomly.
Pair Corralation between Bank of China and Chongqing Gas
Assuming the 90 days trading horizon Bank of China is expected to generate 0.79 times more return on investment than Chongqing Gas. However, Bank of China is 1.27 times less risky than Chongqing Gas. It trades about 0.08 of its potential returns per unit of risk. Chongqing Gas Grp is currently generating about 0.02 per unit of risk. If you would invest 435.00 in Bank of China on November 3, 2024 and sell it today you would earn a total of 110.00 from holding Bank of China or generate 25.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Chongqing Gas Grp
Performance |
| Timeline |
| Bank of China |
| Chongqing Gas Grp |
Bank of China and Chongqing Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Chongqing Gas
The main advantage of trading using opposite Bank of China and Chongqing Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Chongqing Gas 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 Chongqing Gas will offset losses from the drop in Chongqing Gas' 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 |
| Chongqing Gas vs. Shengda Mining Co | Chongqing Gas vs. Quectel Wireless Solutions | Chongqing Gas vs. JCHX Mining Management | Chongqing Gas vs. Nanxing Furniture Machinery |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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