Correlation Between Chuangs China and LANSON-BCC INH
Can any of the company-specific risk be diversified away by investing in both Chuangs China and LANSON-BCC INH 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 Chuangs China and LANSON-BCC INH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chuangs China Investments and LANSON BCC INH EO, you can compare the effects of market volatilities on Chuangs China and LANSON-BCC INH 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 Chuangs China with a short position of LANSON-BCC INH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chuangs China and LANSON-BCC INH.
Diversification Opportunities for Chuangs China and LANSON-BCC INH
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chuangs and LANSON-BCC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chuangs China Investments and LANSON BCC INH EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LANSON BCC INH and Chuangs China 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 Chuangs China Investments are associated (or correlated) with LANSON-BCC INH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LANSON BCC INH has no effect on the direction of Chuangs China i.e., Chuangs China and LANSON-BCC INH go up and down completely randomly.
Pair Corralation between Chuangs China and LANSON-BCC INH
If you would invest 1.00 in Chuangs China Investments on October 23, 2024 and sell it today you would earn a total of 0.00 from holding Chuangs China Investments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Chuangs China Investments vs. LANSON BCC INH EO
Performance |
| Timeline |
| Chuangs China Investments |
| LANSON BCC INH |
Chuangs China and LANSON-BCC INH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chuangs China and LANSON-BCC INH
The main advantage of trading using opposite Chuangs China and LANSON-BCC INH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chuangs China position performs unexpectedly, LANSON-BCC INH 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 LANSON-BCC INH will offset losses from the drop in LANSON-BCC INH's long position.| Chuangs China vs. KOBE STEEL LTD | Chuangs China vs. MOUNT GIBSON IRON | Chuangs China vs. ANGANG STEEL H | Chuangs China vs. T Mobile |
| LANSON-BCC INH vs. Altia Oyj | LANSON-BCC INH vs. VIRGIN WINES UK | LANSON-BCC INH vs. Superior Plus Corp | LANSON-BCC INH vs. Origin Agritech |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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