Correlation Between Bank of China and Shanghai Jin
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By analyzing existing cross correlation between Bank of China and Shanghai Jin Jiang, you can compare the effects of market volatilities on Bank of China and Shanghai Jin 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 Jin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Shanghai Jin.
Diversification Opportunities for Bank of China and Shanghai Jin
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bank and Shanghai is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Shanghai Jin Jiang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Jin Jiang 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 Jin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Jin Jiang has no effect on the direction of Bank of China i.e., Bank of China and Shanghai Jin go up and down completely randomly.
Pair Corralation between Bank of China and Shanghai Jin
Assuming the 90 days trading horizon Bank of China is expected to generate 0.84 times more return on investment than Shanghai Jin. However, Bank of China is 1.18 times less risky than Shanghai Jin. It trades about 0.1 of its potential returns per unit of risk. Shanghai Jin Jiang is currently generating about -0.03 per unit of risk. If you would invest 301.00 in Bank of China on September 26, 2024 and sell it today you would earn a total of 250.00 from holding Bank of China or generate 83.06% 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. Shanghai Jin Jiang
Performance |
| Timeline |
| Bank of China |
| Shanghai Jin Jiang |
Bank of China and Shanghai Jin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Shanghai Jin
The main advantage of trading using opposite Bank of China and Shanghai Jin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Shanghai Jin 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 Jin will offset losses from the drop in Shanghai Jin's long position.| Bank of China vs. Industrial and Commercial | Bank of China vs. Kweichow Moutai Co | Bank of China vs. Agricultural Bank of | Bank of China vs. China Mobile Limited |
| Shanghai Jin vs. Bank of China | Shanghai Jin vs. Kweichow Moutai Co | Shanghai Jin vs. PetroChina Co Ltd | Shanghai Jin vs. Bank of Communications |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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