Correlation Between Eyebright Medical and Bank of China
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By analyzing existing cross correlation between Eyebright Medical Technology and Bank of China, you can compare the effects of market volatilities on Eyebright Medical and Bank of China 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 Eyebright Medical with a short position of Bank of China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eyebright Medical and Bank of China.
Diversification Opportunities for Eyebright Medical and Bank of China
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Eyebright and Bank is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Eyebright Medical Technology and Bank of China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of China and Eyebright Medical 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 Eyebright Medical Technology are associated (or correlated) with Bank of China. 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 China has no effect on the direction of Eyebright Medical i.e., Eyebright Medical and Bank of China go up and down completely randomly.
Pair Corralation between Eyebright Medical and Bank of China
Assuming the 90 days trading horizon Eyebright Medical Technology is expected to under-perform the Bank of China. In addition to that, Eyebright Medical is 3.66 times more volatile than Bank of China. It trades about -0.16 of its total potential returns per unit of risk. Bank of China is currently generating about 0.2 per unit of volatility. If you would invest 483.00 in Bank of China on August 31, 2024 and sell it today you would earn a total of 20.00 from holding Bank of China or generate 4.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eyebright Medical Technology vs. Bank of China
Performance |
| Timeline |
| Eyebright Medical |
| Bank of China |
Eyebright Medical and Bank of China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eyebright Medical and Bank of China
The main advantage of trading using opposite Eyebright Medical and Bank of China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eyebright Medical position performs unexpectedly, Bank of China 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 China will offset losses from the drop in Bank of China's long position.| Eyebright Medical vs. PetroChina Co Ltd | Eyebright Medical vs. China Mobile Limited | Eyebright Medical vs. Ping An Insurance | Eyebright Medical vs. China Petroleum Chemical |
| Bank of China vs. Tianjin Hi Tech Development | Bank of China vs. Dazhong Transportation Group | Bank of China vs. Hubeiyichang Transportation Group | Bank of China vs. Guangdong Shenglu Telecommunication |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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