Correlation Between AGRICUL BK and CHINA VANKE
Can any of the company-specific risk be diversified away by investing in both AGRICUL BK and CHINA VANKE 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 AGRICUL BK and CHINA VANKE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGRICUL BK CHINA H and CHINA VANKE TD, you can compare the effects of market volatilities on AGRICUL BK and CHINA VANKE 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 AGRICUL BK with a short position of CHINA VANKE. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICUL BK and CHINA VANKE.
Diversification Opportunities for AGRICUL BK and CHINA VANKE
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGRICUL and CHINA is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding AGRICUL BK CHINA H and CHINA VANKE TD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA VANKE TD and AGRICUL BK 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 AGRICUL BK CHINA H are associated (or correlated) with CHINA VANKE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA VANKE TD has no effect on the direction of AGRICUL BK i.e., AGRICUL BK and CHINA VANKE go up and down completely randomly.
Pair Corralation between AGRICUL BK and CHINA VANKE
Assuming the 90 days trading horizon AGRICUL BK CHINA H is expected to generate 0.67 times more return on investment than CHINA VANKE. However, AGRICUL BK CHINA H is 1.49 times less risky than CHINA VANKE. It trades about 0.07 of its potential returns per unit of risk. CHINA VANKE TD is currently generating about 0.02 per unit of risk. If you would invest 14.00 in AGRICUL BK CHINA H on August 31, 2024 and sell it today you would earn a total of 32.00 from holding AGRICUL BK CHINA H or generate 228.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.75% |
| Values | Daily Returns |
AGRICUL BK CHINA H vs. CHINA VANKE TD
Performance |
| Timeline |
| AGRICUL BK CHINA |
| CHINA VANKE TD |
AGRICUL BK and CHINA VANKE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICUL BK and CHINA VANKE
The main advantage of trading using opposite AGRICUL BK and CHINA VANKE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICUL BK position performs unexpectedly, CHINA VANKE 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 VANKE will offset losses from the drop in CHINA VANKE's long position.| AGRICUL BK vs. Check Point Software | AGRICUL BK vs. Verizon Communications | AGRICUL BK vs. CPU SOFTWAREHOUSE | AGRICUL BK vs. Ribbon Communications |
| CHINA VANKE vs. Apollo Investment Corp | CHINA VANKE vs. SLR Investment Corp | CHINA VANKE vs. WisdomTree Investments | CHINA VANKE vs. New Residential Investment |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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