Correlation Between Huaneng Lancang and China Life
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By analyzing existing cross correlation between Huaneng Lancang River and China Life Insurance, you can compare the effects of market volatilities on Huaneng Lancang and China Life 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 Huaneng Lancang with a short position of China Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huaneng Lancang and China Life.
Diversification Opportunities for Huaneng Lancang and China Life
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Huaneng and China is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Huaneng Lancang River and China Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Life Insurance and Huaneng Lancang 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 Huaneng Lancang River are associated (or correlated) with China Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Life Insurance has no effect on the direction of Huaneng Lancang i.e., Huaneng Lancang and China Life go up and down completely randomly.
Pair Corralation between Huaneng Lancang and China Life
Assuming the 90 days trading horizon Huaneng Lancang River is expected to generate 0.68 times more return on investment than China Life. However, Huaneng Lancang River is 1.46 times less risky than China Life. It trades about 0.2 of its potential returns per unit of risk. China Life Insurance is currently generating about 0.1 per unit of risk. If you would invest 930.00 in Huaneng Lancang River on September 25, 2024 and sell it today you would earn a total of 50.00 from holding Huaneng Lancang River or generate 5.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Huaneng Lancang River vs. China Life Insurance
Performance |
Timeline |
Huaneng Lancang River |
China Life Insurance |
Huaneng Lancang and China Life Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Huaneng Lancang and China Life
The main advantage of trading using opposite Huaneng Lancang and China Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huaneng Lancang position performs unexpectedly, China Life 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 Life will offset losses from the drop in China Life's long position.Huaneng Lancang vs. China Life Insurance | Huaneng Lancang vs. SUNSEA Telecommunications Co | Huaneng Lancang vs. Guangdong Shenglu Telecommunication | Huaneng Lancang vs. Zhejiang JIULI Hi tech |
China Life vs. Kweichow Moutai Co | China Life vs. Shenzhen Mindray Bio Medical | China Life vs. Jiangsu Pacific Quartz | China Life vs. G bits Network Technology |
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 CEOs Directory module to screen CEOs from public companies around the world.
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