Correlation Between China Taiping and CIG PANNONIA
Can any of the company-specific risk be diversified away by investing in both China Taiping and CIG PANNONIA 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 Taiping and CIG PANNONIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Taiping Insurance and CIG PANNONIA LIFE, you can compare the effects of market volatilities on China Taiping and CIG PANNONIA 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 Taiping with a short position of CIG PANNONIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Taiping and CIG PANNONIA.
Diversification Opportunities for China Taiping and CIG PANNONIA
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and CIG is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding China Taiping Insurance and CIG PANNONIA LIFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIG PANNONIA LIFE and China Taiping 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 Taiping Insurance are associated (or correlated) with CIG PANNONIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIG PANNONIA LIFE has no effect on the direction of China Taiping i.e., China Taiping and CIG PANNONIA go up and down completely randomly.
Pair Corralation between China Taiping and CIG PANNONIA
Assuming the 90 days trading horizon China Taiping Insurance is expected to under-perform the CIG PANNONIA. In addition to that, China Taiping is 1.31 times more volatile than CIG PANNONIA LIFE. It trades about -0.53 of its total potential returns per unit of risk. CIG PANNONIA LIFE is currently generating about 0.01 per unit of volatility. If you would invest 85.00 in CIG PANNONIA LIFE on October 9, 2024 and sell it today you would earn a total of 0.00 from holding CIG PANNONIA LIFE or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Taiping Insurance vs. CIG PANNONIA LIFE
Performance |
| Timeline |
| China Taiping Insurance |
| CIG PANNONIA LIFE |
China Taiping and CIG PANNONIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Taiping and CIG PANNONIA
The main advantage of trading using opposite China Taiping and CIG PANNONIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Taiping position performs unexpectedly, CIG PANNONIA 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 CIG PANNONIA will offset losses from the drop in CIG PANNONIA's long position.| China Taiping vs. PING AN INSURANCH | China Taiping vs. Aflac Incorporated | China Taiping vs. CHINA PACINGRGDR5 YC1 | China Taiping vs. Phoenix Group Holdings |
| CIG PANNONIA vs. PLAYSTUDIOS A DL 0001 | CIG PANNONIA vs. Playmates Toys Limited | CIG PANNONIA vs. Cass Information Systems | CIG PANNONIA vs. ScanSource |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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