Correlation Between China International and National Silicon
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By analyzing existing cross correlation between China International Capital and National Silicon Industry, you can compare the effects of market volatilities on China International and National Silicon 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 China International with a short position of National Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of China International and National Silicon.
Diversification Opportunities for China International and National Silicon
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and National is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China International Capital and National Silicon Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Silicon Industry and China International 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 China International Capital are associated (or correlated) with National Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Silicon Industry has no effect on the direction of China International i.e., China International and National Silicon go up and down completely randomly.
Pair Corralation between China International and National Silicon
Assuming the 90 days trading horizon China International Capital is expected to generate 0.76 times more return on investment than National Silicon. However, China International Capital is 1.32 times less risky than National Silicon. It trades about -0.02 of its potential returns per unit of risk. National Silicon Industry is currently generating about -0.08 per unit of risk. If you would invest 3,580 in China International Capital on August 30, 2024 and sell it today you would lose (78.00) from holding China International Capital or give up 2.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China International Capital vs. National Silicon Industry
Performance |
| Timeline |
| China International |
| National Silicon Industry |
China International and National Silicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China International and National Silicon
The main advantage of trading using opposite China International and National Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China International position performs unexpectedly, National Silicon 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 National Silicon will offset losses from the drop in National Silicon's long position.| China International vs. Youyou Foods Co | China International vs. Sinomach General Machinery | China International vs. Shanghai Ziyan Foods | China International vs. Sichuan Teway Food |
| National Silicon vs. China State Construction | National Silicon vs. Huafa Industrial Co | National Silicon vs. China International Capital | National Silicon vs. Kweichow Moutai 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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