Correlation Between China Resources and Strix Group
Can any of the company-specific risk be diversified away by investing in both China Resources and Strix Group 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 China Resources and Strix Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Resources Beer and Strix Group Plc, you can compare the effects of market volatilities on China Resources and Strix Group 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 Resources with a short position of Strix Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Resources and Strix Group.
Diversification Opportunities for China Resources and Strix Group
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Strix is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding China Resources Beer and Strix Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strix Group Plc and China Resources 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 Resources Beer are associated (or correlated) with Strix Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strix Group Plc has no effect on the direction of China Resources i.e., China Resources and Strix Group go up and down completely randomly.
Pair Corralation between China Resources and Strix Group
Assuming the 90 days horizon China Resources Beer is expected to generate 1.47 times more return on investment than Strix Group. However, China Resources is 1.47 times more volatile than Strix Group Plc. It trades about 0.02 of its potential returns per unit of risk. Strix Group Plc is currently generating about -0.04 per unit of risk. If you would invest 295.00 in China Resources Beer on November 5, 2024 and sell it today you would earn a total of 3.00 from holding China Resources Beer or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Resources Beer vs. Strix Group Plc
Performance |
| Timeline |
| China Resources Beer |
| Strix Group Plc |
China Resources and Strix Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Resources and Strix Group
The main advantage of trading using opposite China Resources and Strix Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Resources position performs unexpectedly, Strix Group 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 Strix Group will offset losses from the drop in Strix Group's long position.| China Resources vs. CNVISION MEDIA | China Resources vs. ANTA SPORTS PRODUCT | China Resources vs. Virtus Investment Partners | China Resources vs. Keck Seng Investments |
| Strix Group vs. Sixt Leasing SE | Strix Group vs. FIRST SHIP LEASE | Strix Group vs. PROSIEBENSAT1 MEDIADR4 | Strix Group vs. PARKEN Sport Entertainment |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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