Correlation Between Bomesc Offshore and Chongqing Changan
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By analyzing existing cross correlation between Bomesc Offshore Engineering and Chongqing Changan Automobile, you can compare the effects of market volatilities on Bomesc Offshore and Chongqing Changan 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 Bomesc Offshore with a short position of Chongqing Changan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bomesc Offshore and Chongqing Changan.
Diversification Opportunities for Bomesc Offshore and Chongqing Changan
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bomesc and Chongqing is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Bomesc Offshore Engineering and Chongqing Changan Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Changan and Bomesc Offshore 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 Bomesc Offshore Engineering are associated (or correlated) with Chongqing Changan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Changan has no effect on the direction of Bomesc Offshore i.e., Bomesc Offshore and Chongqing Changan go up and down completely randomly.
Pair Corralation between Bomesc Offshore and Chongqing Changan
Assuming the 90 days trading horizon Bomesc Offshore is expected to generate 1.36 times less return on investment than Chongqing Changan. In addition to that, Bomesc Offshore is 1.44 times more volatile than Chongqing Changan Automobile. It trades about 0.02 of its total potential returns per unit of risk. Chongqing Changan Automobile is currently generating about 0.03 per unit of volatility. If you would invest 306.00 in Chongqing Changan Automobile on November 27, 2024 and sell it today you would earn a total of 63.00 from holding Chongqing Changan Automobile or generate 20.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bomesc Offshore Engineering vs. Chongqing Changan Automobile
Performance |
| Timeline |
| Bomesc Offshore Engi |
| Chongqing Changan |
Bomesc Offshore and Chongqing Changan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bomesc Offshore and Chongqing Changan
The main advantage of trading using opposite Bomesc Offshore and Chongqing Changan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bomesc Offshore position performs unexpectedly, Chongqing Changan 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 Chongqing Changan will offset losses from the drop in Chongqing Changan's long position.| Bomesc Offshore vs. Zhejiang Kingland Pipeline | Bomesc Offshore vs. Cambricon Technologies Corp | Bomesc Offshore vs. Shandong Rike Chemical | Bomesc Offshore vs. Ping An Guangzhou |
| Chongqing Changan vs. Impulse Qingdao Health | Chongqing Changan vs. By health | Chongqing Changan vs. Anhui Huaren Health | Chongqing Changan vs. Ningbo Jintian Copper |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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