Correlation Between BEIJING JINGYEDA and COSCO SHIPPING

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Can any of the company-specific risk be diversified away by investing in both BEIJING JINGYEDA and COSCO SHIPPING at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining BEIJING JINGYEDA and COSCO SHIPPING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BEIJING JINGYEDA T and COSCO SHIPPING HOLDINGS, you can compare the effects of market volatilities on BEIJING JINGYEDA and COSCO SHIPPING 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 JINGYEDA with a short position of COSCO SHIPPING. Check out your portfolio center. Please also check ongoing floating volatility patterns of BEIJING JINGYEDA and COSCO SHIPPING.

Diversification Opportunities for BEIJING JINGYEDA and COSCO SHIPPING

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between BEIJING and COSCO is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BEIJING JINGYEDA T and COSCO SHIPPING HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSCO SHIPPING HOLDINGS and BEIJING JINGYEDA 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 JINGYEDA T are associated (or correlated) with COSCO SHIPPING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSCO SHIPPING HOLDINGS has no effect on the direction of BEIJING JINGYEDA i.e., BEIJING JINGYEDA and COSCO SHIPPING go up and down completely randomly.

Pair Corralation between BEIJING JINGYEDA and COSCO SHIPPING

If you would invest (100.00)  in BEIJING JINGYEDA T on August 31, 2022 and sell it today you would earn a total of  100.00  from holding BEIJING JINGYEDA T or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

BEIJING JINGYEDA T  vs.  COSCO SHIPPING HOLDINGS

 Performance (%) 
       Timeline  
BEIJING JINGYEDA T 
BEIJING Performance
0 of 100
Over the last 90 days BEIJING JINGYEDA T has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, BEIJING JINGYEDA is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
COSCO SHIPPING HOLDINGS 
COSCO Performance
0 of 100
Over the last 90 days COSCO SHIPPING HOLDINGS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

COSCO Price Channel

BEIJING JINGYEDA and COSCO SHIPPING Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with BEIJING JINGYEDA and COSCO SHIPPING

The main advantage of trading using opposite BEIJING JINGYEDA and COSCO SHIPPING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BEIJING JINGYEDA position performs unexpectedly, COSCO SHIPPING 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 COSCO SHIPPING will offset losses from the drop in COSCO SHIPPING's long position.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against BEIJING JINGYEDA as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. BEIJING JINGYEDA's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, BEIJING JINGYEDA's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to BEIJING JINGYEDA T.
The idea behind BEIJING JINGYEDA T and COSCO SHIPPING HOLDINGS pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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