Correlation Between Chahua Modern and Beijing New
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By analyzing existing cross correlation between Chahua Modern Housewares and Beijing New Building, you can compare the effects of market volatilities on Chahua Modern and Beijing New 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 Chahua Modern with a short position of Beijing New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chahua Modern and Beijing New.
Diversification Opportunities for Chahua Modern and Beijing New
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chahua and Beijing is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Chahua Modern Housewares and Beijing New Building in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing New Building and Chahua Modern 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 Chahua Modern Housewares are associated (or correlated) with Beijing New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing New Building has no effect on the direction of Chahua Modern i.e., Chahua Modern and Beijing New go up and down completely randomly.
Pair Corralation between Chahua Modern and Beijing New
Assuming the 90 days trading horizon Chahua Modern Housewares is expected to generate 1.56 times more return on investment than Beijing New. However, Chahua Modern is 1.56 times more volatile than Beijing New Building. It trades about 0.08 of its potential returns per unit of risk. Beijing New Building is currently generating about 0.02 per unit of risk. If you would invest 806.00 in Chahua Modern Housewares on September 3, 2024 and sell it today you would earn a total of 1,400 from holding Chahua Modern Housewares or generate 173.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chahua Modern Housewares vs. Beijing New Building
Performance |
| Timeline |
| Chahua Modern Housewares |
| Beijing New Building |
Chahua Modern and Beijing New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chahua Modern and Beijing New
The main advantage of trading using opposite Chahua Modern and Beijing New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chahua Modern position performs unexpectedly, Beijing New 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 Beijing New will offset losses from the drop in Beijing New's long position.| Chahua Modern vs. PetroChina Co Ltd | Chahua Modern vs. China Mobile Limited | Chahua Modern vs. Industrial and Commercial | Chahua Modern vs. China Life Insurance |
| Beijing New vs. Cultural Investment Holdings | Beijing New vs. Gome Telecom Equipment | Beijing New vs. Bus Online Co | Beijing New vs. Holitech Technology 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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