Correlation Between China Railway and China Publishing
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By analyzing existing cross correlation between China Railway Construction and China Publishing Media, you can compare the effects of market volatilities on China Railway and China Publishing 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 China Railway with a short position of China Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and China Publishing.
Diversification Opportunities for China Railway and China Publishing
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and China is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Construction and China Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Publishing Media and China Railway 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 China Railway Construction are associated (or correlated) with China Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Publishing Media has no effect on the direction of China Railway i.e., China Railway and China Publishing go up and down completely randomly.
Pair Corralation between China Railway and China Publishing
Assuming the 90 days trading horizon China Railway is expected to generate 1.19 times less return on investment than China Publishing. But when comparing it to its historical volatility, China Railway Construction is 1.33 times less risky than China Publishing. It trades about 0.2 of its potential returns per unit of risk. China Publishing Media is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 573.00 in China Publishing Media on September 3, 2024 and sell it today you would earn a total of 253.00 from holding China Publishing Media or generate 44.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Construction vs. China Publishing Media
Performance |
| Timeline |
| China Railway Constr |
| China Publishing Media |
China Railway and China Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and China Publishing
The main advantage of trading using opposite China Railway and China Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, China Publishing 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 Publishing will offset losses from the drop in China Publishing's long position.| China Railway vs. Xinjiang Communications Construction | China Railway vs. HanS Laser Tech | China Railway vs. Eastern Communications Co | China Railway vs. Linewell Software Co |
| China Publishing vs. China Railway Construction | China Publishing vs. Lutian Machinery Co | China Publishing vs. Anhui Huilong Agricultural | China Publishing vs. Yingde Greatchem Chemicals |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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