Correlation Between Beijing Wantai and Runjian Communication
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By analyzing existing cross correlation between Beijing Wantai Biological and Runjian Communication Co, you can compare the effects of market volatilities on Beijing Wantai and Runjian Communication 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 Wantai with a short position of Runjian Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Wantai and Runjian Communication.
Diversification Opportunities for Beijing Wantai and Runjian Communication
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Runjian is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Wantai Biological and Runjian Communication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Runjian Communication and Beijing Wantai 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 Wantai Biological are associated (or correlated) with Runjian Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Runjian Communication has no effect on the direction of Beijing Wantai i.e., Beijing Wantai and Runjian Communication go up and down completely randomly.
Pair Corralation between Beijing Wantai and Runjian Communication
Assuming the 90 days trading horizon Beijing Wantai Biological is expected to generate 0.93 times more return on investment than Runjian Communication. However, Beijing Wantai Biological is 1.07 times less risky than Runjian Communication. It trades about 0.02 of its potential returns per unit of risk. Runjian Communication Co is currently generating about 0.01 per unit of risk. If you would invest 6,925 in Beijing Wantai Biological on September 23, 2024 and sell it today you would earn a total of 705.00 from holding Beijing Wantai Biological or generate 10.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Beijing Wantai Biological vs. Runjian Communication Co
Performance |
Timeline |
Beijing Wantai Biological |
Runjian Communication |
Beijing Wantai and Runjian Communication Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Beijing Wantai and Runjian Communication
The main advantage of trading using opposite Beijing Wantai and Runjian Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Wantai position performs unexpectedly, Runjian Communication 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 Runjian Communication will offset losses from the drop in Runjian Communication's long position.Beijing Wantai vs. Industrial and Commercial | Beijing Wantai vs. Agricultural Bank of | Beijing Wantai vs. China Construction Bank | Beijing Wantai vs. Bank of China |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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