Correlation Between China Life and Yunnan Chihong
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By analyzing existing cross correlation between China Life Insurance and Yunnan Chihong ZincGermanium, you can compare the effects of market volatilities on China Life and Yunnan Chihong 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 Yunnan Chihong. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Life and Yunnan Chihong.
Diversification Opportunities for China Life and Yunnan Chihong
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Yunnan is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding China Life Insurance and Yunnan Chihong ZincGermanium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yunnan Chihong ZincG 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 Yunnan Chihong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yunnan Chihong ZincG has no effect on the direction of China Life i.e., China Life and Yunnan Chihong go up and down completely randomly.
Pair Corralation between China Life and Yunnan Chihong
Assuming the 90 days trading horizon China Life Insurance is expected to generate 1.36 times more return on investment than Yunnan Chihong. However, China Life is 1.36 times more volatile than Yunnan Chihong ZincGermanium. It trades about 0.1 of its potential returns per unit of risk. Yunnan Chihong ZincGermanium is currently generating about -0.01 per unit of risk. If you would invest 4,096 in China Life Insurance on September 25, 2024 and sell it today you would earn a total of 152.00 from holding China Life Insurance or generate 3.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 95.45% |
Values | Daily Returns |
China Life Insurance vs. Yunnan Chihong ZincGermanium
Performance |
Timeline |
China Life Insurance |
Yunnan Chihong ZincG |
China Life and Yunnan Chihong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Life and Yunnan Chihong
The main advantage of trading using opposite China Life and Yunnan Chihong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Life position performs unexpectedly, Yunnan Chihong 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 Yunnan Chihong will offset losses from the drop in Yunnan Chihong's long position.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 |
Yunnan Chihong vs. Zijin Mining Group | Yunnan Chihong vs. Wanhua Chemical Group | Yunnan Chihong vs. Baoshan Iron Steel | Yunnan Chihong 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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