Correlation Between Eastroc Beverage and China Construction
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By analyzing existing cross correlation between Eastroc Beverage Group and China Construction Bank, you can compare the effects of market volatilities on Eastroc Beverage 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 Eastroc Beverage with a short position of China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastroc Beverage and China Construction.
Diversification Opportunities for Eastroc Beverage and China Construction
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Eastroc and China is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Eastroc Beverage Group 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 Eastroc Beverage 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 Eastroc Beverage Group 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 Eastroc Beverage i.e., Eastroc Beverage and China Construction go up and down completely randomly.
Pair Corralation between Eastroc Beverage and China Construction
Assuming the 90 days trading horizon Eastroc Beverage Group is expected to generate 2.32 times more return on investment than China Construction. However, Eastroc Beverage is 2.32 times more volatile than China Construction Bank. It trades about 0.22 of its potential returns per unit of risk. China Construction Bank is currently generating about 0.23 per unit of risk. If you would invest 22,033 in Eastroc Beverage Group on September 13, 2024 and sell it today you would earn a total of 2,217 from holding Eastroc Beverage Group or generate 10.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastroc Beverage Group vs. China Construction Bank
Performance |
| Timeline |
| Eastroc Beverage |
| China Construction Bank |
Eastroc Beverage and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastroc Beverage and China Construction
The main advantage of trading using opposite Eastroc Beverage and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastroc Beverage 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.| Eastroc Beverage vs. Industrial and Commercial | Eastroc Beverage vs. Kweichow Moutai Co | Eastroc Beverage vs. Agricultural Bank of | Eastroc Beverage vs. China Mobile Limited |
| China Construction vs. Eastroc Beverage Group | China Construction vs. Youyou Foods Co | China Construction vs. HaiXin Foods Co | China Construction vs. Shanghai Metersbonwe FashionAccessories |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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