Correlation Between China Citic and Bank of XiAn
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By analyzing existing cross correlation between China Citic Bank and Bank of XiAn, you can compare the effects of market volatilities on China Citic and Bank of XiAn 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 Citic with a short position of Bank of XiAn. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Citic and Bank of XiAn.
Diversification Opportunities for China Citic and Bank of XiAn
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Bank is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding China Citic Bank and Bank of XiAn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of XiAn and China Citic 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 Citic Bank are associated (or correlated) with Bank of XiAn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of XiAn has no effect on the direction of China Citic i.e., China Citic and Bank of XiAn go up and down completely randomly.
Pair Corralation between China Citic and Bank of XiAn
Assuming the 90 days trading horizon China Citic Bank is expected to generate 0.78 times more return on investment than Bank of XiAn. However, China Citic Bank is 1.29 times less risky than Bank of XiAn. It trades about 0.06 of its potential returns per unit of risk. Bank of XiAn is currently generating about 0.04 per unit of risk. If you would invest 668.00 in China Citic Bank on September 4, 2024 and sell it today you would earn a total of 12.00 from holding China Citic Bank or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Citic Bank vs. Bank of XiAn
Performance |
| Timeline |
| China Citic Bank |
| Bank of XiAn |
China Citic and Bank of XiAn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Citic and Bank of XiAn
The main advantage of trading using opposite China Citic and Bank of XiAn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Citic position performs unexpectedly, Bank of XiAn 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 Bank of XiAn will offset losses from the drop in Bank of XiAn's long position.| China Citic vs. Mingchen Health Co | China Citic vs. Luyin Investment Group | China Citic vs. Beijing Mainstreets Investment | China Citic vs. Shandong Sinoglory Health |
| Bank of XiAn vs. Luyin Investment Group | Bank of XiAn vs. Jointo Energy Investment | Bank of XiAn vs. Hunan Investment Group | Bank of XiAn vs. Harbin Hatou Investment |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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