Correlation Between Beken Corp and China Construction
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By analyzing existing cross correlation between Beken Corp and China Construction Bank, you can compare the effects of market volatilities on Beken Corp and China Construction 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 Beken Corp with a short position of China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beken Corp and China Construction.
Diversification Opportunities for Beken Corp and China Construction
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beken and China is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Beken Corp and China Construction Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Construction Bank and Beken Corp 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 Beken Corp are associated (or correlated) with China Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Construction Bank has no effect on the direction of Beken Corp i.e., Beken Corp and China Construction go up and down completely randomly.
Pair Corralation between Beken Corp and China Construction
Assuming the 90 days trading horizon Beken Corp is expected to generate 1.47 times less return on investment than China Construction. In addition to that, Beken Corp is 3.99 times more volatile than China Construction Bank. It trades about 0.08 of its total potential returns per unit of risk. China Construction Bank is currently generating about 0.49 per unit of volatility. If you would invest 798.00 in China Construction Bank on September 27, 2024 and sell it today you would earn a total of 90.00 from holding China Construction Bank or generate 11.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beken Corp vs. China Construction Bank
Performance |
| Timeline |
| Beken Corp |
| China Construction Bank |
Beken Corp and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beken Corp and China Construction
The main advantage of trading using opposite Beken Corp and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beken Corp position performs unexpectedly, China Construction 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 China Construction will offset losses from the drop in China Construction's long position.| Beken Corp vs. Guangzhou Restaurants Group | Beken Corp vs. Hefei Metalforming Mach | Beken Corp vs. Guangdong Wens Foodstuff | Beken Corp vs. Bus Online Co |
| China Construction vs. Industrial and Commercial | China Construction vs. Kweichow Moutai Co | China Construction vs. Agricultural Bank of | China Construction vs. China Mobile Limited |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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