Correlation Between CIFI Holdings and China Resources
Can any of the company-specific risk be diversified away by investing in both CIFI Holdings and China Resources at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CIFI Holdings and China Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIFI Holdings Co and China Resources Land, you can compare the effects of market volatilities on CIFI Holdings and China Resources 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 CIFI Holdings with a short position of China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIFI Holdings and China Resources.
Diversification Opportunities for CIFI Holdings and China Resources
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CIFI and China is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding CIFI Holdings Co and China Resources Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Land and CIFI Holdings 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 CIFI Holdings Co are associated (or correlated) with China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Land has no effect on the direction of CIFI Holdings i.e., CIFI Holdings and China Resources go up and down completely randomly.
Pair Corralation between CIFI Holdings and China Resources
If you would invest 188.00 in China Resources Land on September 2, 2024 and sell it today you would earn a total of 84.00 from holding China Resources Land or generate 44.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 0.77% |
| Values | Daily Returns |
CIFI Holdings Co vs. China Resources Land
Performance |
| Timeline |
| CIFI Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| China Resources Land |
CIFI Holdings and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CIFI Holdings and China Resources
The main advantage of trading using opposite CIFI Holdings and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIFI Holdings position performs unexpectedly, China Resources 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 Resources will offset losses from the drop in China Resources' long position.| CIFI Holdings vs. TOREX SEMICONDUCTOR LTD | CIFI Holdings vs. Ping An Insurance | CIFI Holdings vs. Reinsurance Group of | CIFI Holdings vs. Nordic Semiconductor ASA |
| China Resources vs. NXP Semiconductors NV | China Resources vs. Daito Trust Construction | China Resources vs. Chongqing Machinery Electric | China Resources vs. Elmos Semiconductor SE |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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