Correlation Between Capital Income and Shenzhen Bingchuan
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By analyzing existing cross correlation between Capital Income Builder and Shenzhen Bingchuan Network, you can compare the effects of market volatilities on Capital Income and Shenzhen Bingchuan 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 Capital Income with a short position of Shenzhen Bingchuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Income and Shenzhen Bingchuan.
Diversification Opportunities for Capital Income and Shenzhen Bingchuan
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Capital and Shenzhen is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Capital Income Builder and Shenzhen Bingchuan Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bingchuan and Capital Income 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 Capital Income Builder are associated (or correlated) with Shenzhen Bingchuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bingchuan has no effect on the direction of Capital Income i.e., Capital Income and Shenzhen Bingchuan go up and down completely randomly.
Pair Corralation between Capital Income and Shenzhen Bingchuan
Assuming the 90 days horizon Capital Income is expected to generate 3.74 times less return on investment than Shenzhen Bingchuan. But when comparing it to its historical volatility, Capital Income Builder is 5.45 times less risky than Shenzhen Bingchuan. It trades about 0.26 of its potential returns per unit of risk. Shenzhen Bingchuan Network is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,942 in Shenzhen Bingchuan Network on November 3, 2024 and sell it today you would earn a total of 198.00 from holding Shenzhen Bingchuan Network or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Capital Income Builder vs. Shenzhen Bingchuan Network
Performance |
| Timeline |
| Capital Income Builder |
| Shenzhen Bingchuan |
Capital Income and Shenzhen Bingchuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Income and Shenzhen Bingchuan
The main advantage of trading using opposite Capital Income and Shenzhen Bingchuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Income position performs unexpectedly, Shenzhen Bingchuan 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 Shenzhen Bingchuan will offset losses from the drop in Shenzhen Bingchuan's long position.| Capital Income vs. Blackrock Financial Institutions | Capital Income vs. Fidelity Advisor Financial | Capital Income vs. Blackstone Secured Lending | Capital Income vs. 1919 Financial Services |
| Shenzhen Bingchuan vs. Lier Chemical Co | Shenzhen Bingchuan vs. Lianhe Chemical Technology | Shenzhen Bingchuan vs. Huasi Agricultural Development | Shenzhen Bingchuan vs. Tjk Machinery Tianjin |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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