Correlation Between Beijing Kingsoft and China Baoan
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By analyzing existing cross correlation between Beijing Kingsoft Office and China Baoan Group, you can compare the effects of market volatilities on Beijing Kingsoft and China Baoan 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 Beijing Kingsoft with a short position of China Baoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Kingsoft and China Baoan.
Diversification Opportunities for Beijing Kingsoft and China Baoan
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Beijing and China is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Kingsoft Office and China Baoan Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Baoan Group and Beijing Kingsoft 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 Beijing Kingsoft Office are associated (or correlated) with China Baoan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Baoan Group has no effect on the direction of Beijing Kingsoft i.e., Beijing Kingsoft and China Baoan go up and down completely randomly.
Pair Corralation between Beijing Kingsoft and China Baoan
Assuming the 90 days trading horizon Beijing Kingsoft Office is expected to generate 2.81 times more return on investment than China Baoan. However, Beijing Kingsoft is 2.81 times more volatile than China Baoan Group. It trades about 0.15 of its potential returns per unit of risk. China Baoan Group is currently generating about -0.4 per unit of risk. If you would invest 28,639 in Beijing Kingsoft Office on November 1, 2024 and sell it today you would earn a total of 2,761 from holding Beijing Kingsoft Office or generate 9.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Kingsoft Office vs. China Baoan Group
Performance |
| Timeline |
| Beijing Kingsoft Office |
| China Baoan Group |
Beijing Kingsoft and China Baoan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Kingsoft and China Baoan
The main advantage of trading using opposite Beijing Kingsoft and China Baoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Kingsoft position performs unexpectedly, China Baoan 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 Baoan will offset losses from the drop in China Baoan's long position.| Beijing Kingsoft vs. Bank of China | Beijing Kingsoft vs. Kweichow Moutai Co | Beijing Kingsoft vs. PetroChina Co Ltd | Beijing Kingsoft vs. Bank of Communications |
| China Baoan vs. Jilin Jlu Communication | China Baoan vs. Eastern Communications Co | China Baoan vs. Beijing Kingsoft Office | China Baoan vs. Queclink Wireless Solutions |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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