Correlation Between Bank of China and Biwin Storage
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By analyzing existing cross correlation between Bank of China and Biwin Storage Technology, you can compare the effects of market volatilities on Bank of China and Biwin Storage 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 Bank of China with a short position of Biwin Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Biwin Storage.
Diversification Opportunities for Bank of China and Biwin Storage
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Biwin is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Biwin Storage Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biwin Storage Technology and Bank of China 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 Bank of China are associated (or correlated) with Biwin Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biwin Storage Technology has no effect on the direction of Bank of China i.e., Bank of China and Biwin Storage go up and down completely randomly.
Pair Corralation between Bank of China and Biwin Storage
Assuming the 90 days trading horizon Bank of China is expected to generate 3.3 times less return on investment than Biwin Storage. But when comparing it to its historical volatility, Bank of China is 3.74 times less risky than Biwin Storage. It trades about 0.15 of its potential returns per unit of risk. Biwin Storage Technology is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 4,228 in Biwin Storage Technology on September 12, 2024 and sell it today you would earn a total of 1,655 from holding Biwin Storage Technology or generate 39.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bank of China vs. Biwin Storage Technology
Performance |
Timeline |
Bank of China |
Biwin Storage Technology |
Bank of China and Biwin Storage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bank of China and Biwin Storage
The main advantage of trading using opposite Bank of China and Biwin Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Biwin Storage 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 Biwin Storage will offset losses from the drop in Biwin Storage's long position.Bank of China vs. Chenzhou Jingui Silver | Bank of China vs. Hangzhou Pinming Software | Bank of China vs. Shandong Mining Machinery | Bank of China vs. Tibet Huayu Mining |
Biwin Storage vs. Gansu Jiu Steel | Biwin Storage vs. Shandong Mining Machinery | Biwin Storage vs. Aba Chemicals Corp | Biwin Storage vs. BlueFocus Communication Group |
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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