Correlation Between China Securities and BEL Small
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By analyzing existing cross correlation between China Securities 800 and BEL Small, you can compare the effects of market volatilities on China Securities and BEL Small 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 Securities with a short position of BEL Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and BEL Small.
Diversification Opportunities for China Securities and BEL Small
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and BEL is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and BEL Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BEL Small and China Securities 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 Securities 800 are associated (or correlated) with BEL Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BEL Small has no effect on the direction of China Securities i.e., China Securities and BEL Small go up and down completely randomly.
Pair Corralation between China Securities and BEL Small
Assuming the 90 days trading horizon China Securities 800 is expected to generate 1.2 times more return on investment than BEL Small. However, China Securities is 1.2 times more volatile than BEL Small. It trades about 0.12 of its potential returns per unit of risk. BEL Small is currently generating about -0.19 per unit of risk. If you would invest 382,687 in China Securities 800 on February 4, 2024 and sell it today you would earn a total of 8,114 from holding China Securities 800 or generate 2.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 85.71% |
Values | Daily Returns |
China Securities 800 vs. BEL Small
Performance |
Timeline |
China Securities and BEL Small Volatility Contrast
Predicted Return Density |
Returns |
China Securities 800
Pair trading matchups for China Securities
BEL Small
Pair trading matchups for BEL Small
Pair Trading with China Securities and BEL Small
The main advantage of trading using opposite China Securities and BEL Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, BEL Small 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 BEL Small will offset losses from the drop in BEL Small's long position.China Securities vs. Wuxi ETEK Microelectronics | China Securities vs. Vanfund Urban Investment | China Securities vs. Techshine Electronics Co | China Securities vs. Dongguan Tarry Electronics |
BEL Small vs. Immolease Trust NV | BEL Small vs. Shurgard Self Storage | BEL Small vs. Retail Estates | BEL Small vs. Intervest Offices |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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