Correlation Between China Life and Harvest Fund
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By analyzing existing cross correlation between China Life Insurance and Harvest Fund Management, you can compare the effects of market volatilities on China Life and Harvest Fund 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 Life with a short position of Harvest Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Harvest Fund.
Diversification Opportunities for China Life and Harvest Fund
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Harvest is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Harvest Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harvest Fund Management and China Life 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 Life Insurance are associated (or correlated) with Harvest Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harvest Fund Management has no effect on the direction of China Life i.e., China Life and Harvest Fund go up and down completely randomly.
Pair Corralation between China Life and Harvest Fund
Assuming the 90 days trading horizon China Life Insurance is expected to generate 5.96 times more return on investment than Harvest Fund. However, China Life is 5.96 times more volatile than Harvest Fund Management. It trades about 0.14 of its potential returns per unit of risk. Harvest Fund Management is currently generating about 0.01 per unit of risk. If you would invest 3,384 in China Life Insurance on September 12, 2024 and sell it today you would earn a total of 942.00 from holding China Life Insurance or generate 27.84% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
China Life Insurance vs. Harvest Fund Management
Performance |
Timeline |
China Life Insurance |
Harvest Fund Management |
China Life and Harvest Fund Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Life and Harvest Fund
The main advantage of trading using opposite China Life and Harvest Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Harvest Fund 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 Harvest Fund will offset losses from the drop in Harvest Fund's long position.China Life vs. China Petroleum Chemical | China Life vs. PetroChina Co Ltd | China Life vs. China Mobile Limited | China Life vs. Industrial and Commercial |
Harvest Fund vs. Kweichow Moutai Co | Harvest Fund vs. Agricultural Bank of | Harvest Fund vs. China Mobile Limited | Harvest Fund vs. China Construction Bank |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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