Correlation Between Beijing Mainstreets and Kangxin New
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By analyzing existing cross correlation between Beijing Mainstreets Investment and Kangxin New Materials, you can compare the effects of market volatilities on Beijing Mainstreets and Kangxin New 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 Beijing Mainstreets with a short position of Kangxin New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Mainstreets and Kangxin New.
Diversification Opportunities for Beijing Mainstreets and Kangxin New
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Kangxin is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Mainstreets Investment and Kangxin New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kangxin New Materials and Beijing Mainstreets 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 Beijing Mainstreets Investment are associated (or correlated) with Kangxin New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kangxin New Materials has no effect on the direction of Beijing Mainstreets i.e., Beijing Mainstreets and Kangxin New go up and down completely randomly.
Pair Corralation between Beijing Mainstreets and Kangxin New
Assuming the 90 days trading horizon Beijing Mainstreets is expected to generate 3.03 times less return on investment than Kangxin New. But when comparing it to its historical volatility, Beijing Mainstreets Investment is 1.22 times less risky than Kangxin New. It trades about 0.06 of its potential returns per unit of risk. Kangxin New Materials is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 126.00 in Kangxin New Materials on September 20, 2024 and sell it today you would earn a total of 129.00 from holding Kangxin New Materials or generate 102.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Beijing Mainstreets Investment vs. Kangxin New Materials
Performance |
Timeline |
Beijing Mainstreets |
Kangxin New Materials |
Beijing Mainstreets and Kangxin New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Beijing Mainstreets and Kangxin New
The main advantage of trading using opposite Beijing Mainstreets and Kangxin New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Mainstreets position performs unexpectedly, Kangxin New 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 Kangxin New will offset losses from the drop in Kangxin New's long position.Beijing Mainstreets vs. China Publishing Media | Beijing Mainstreets vs. Shenyang Chemical Industry | Beijing Mainstreets vs. Zhejiang Publishing Media | Beijing Mainstreets vs. Changjiang Publishing Media |
Kangxin New vs. Zijin Mining Group | Kangxin New vs. Wanhua Chemical Group | Kangxin New vs. Baoshan Iron Steel | Kangxin New vs. Shandong Gold Mining |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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