Correlation Between Bank of China and Gem Year
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By analyzing existing cross correlation between Bank of China and Gem Year Industrial Co, you can compare the effects of market volatilities on Bank of China and Gem Year 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 Gem Year. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Gem Year.
Diversification Opportunities for Bank of China and Gem Year
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bank and Gem is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Gem Year Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gem Year Industrial 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 Gem Year. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gem Year Industrial has no effect on the direction of Bank of China i.e., Bank of China and Gem Year go up and down completely randomly.
Pair Corralation between Bank of China and Gem Year
Assuming the 90 days trading horizon Bank of China is expected to generate 0.34 times more return on investment than Gem Year. However, Bank of China is 2.98 times less risky than Gem Year. It trades about 0.19 of its potential returns per unit of risk. Gem Year Industrial Co is currently generating about 0.03 per unit of risk. If you would invest 482.00 in Bank of China on September 1, 2024 and sell it today you would earn a total of 19.00 from holding Bank of China or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Gem Year Industrial Co
Performance |
| Timeline |
| Bank of China |
| Gem Year Industrial |
Bank of China and Gem Year Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Gem Year
The main advantage of trading using opposite Bank of China and Gem Year positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Gem Year 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 Gem Year will offset losses from the drop in Gem Year's long position.| Bank of China vs. China Minmetals Rare | Bank of China vs. China Eastern Airlines | Bank of China vs. Metro Investment Development | Bank of China vs. Cultural Investment Holdings |
| Gem Year vs. PetroChina Co Ltd | Gem Year vs. China Mobile Limited | Gem Year vs. CNOOC Limited | Gem Year vs. Ping An Insurance |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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