Correlation Between Bank of China and Touchstone International
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By analyzing existing cross correlation between Bank of China and Touchstone International Medical, you can compare the effects of market volatilities on Bank of China and Touchstone International 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 Touchstone International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Touchstone International.
Diversification Opportunities for Bank of China and Touchstone International
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bank and Touchstone is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Touchstone International Medic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone International 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 Touchstone International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone International has no effect on the direction of Bank of China i.e., Bank of China and Touchstone International go up and down completely randomly.
Pair Corralation between Bank of China and Touchstone International
Assuming the 90 days trading horizon Bank of China is expected to generate 0.68 times more return on investment than Touchstone International. However, Bank of China is 1.47 times less risky than Touchstone International. It trades about 0.17 of its potential returns per unit of risk. Touchstone International Medical is currently generating about 0.02 per unit of risk. If you would invest 491.00 in Bank of China on October 26, 2024 and sell it today you would earn a total of 43.00 from holding Bank of China or generate 8.76% 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. Touchstone International Medic
Performance |
| Timeline |
| Bank of China |
| Touchstone International |
Bank of China and Touchstone International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Touchstone International
The main advantage of trading using opposite Bank of China and Touchstone International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Touchstone International 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 Touchstone International will offset losses from the drop in Touchstone International's long position.| Bank of China vs. Harbin Air Conditioning | Bank of China vs. Jinhui Liquor Co | Bank of China vs. MayAir Technology Co | Bank of China vs. Digiwin Software Co |
| Touchstone International vs. Agricultural Bank of | Touchstone International vs. Industrial and Commercial | Touchstone International vs. Bank of China | Touchstone International vs. China Construction Bank |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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