Correlation Between PICC Property and CHINA SOUTHN

Can any of the company-specific risk be diversified away by investing in both PICC Property and CHINA SOUTHN 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 PICC Property and CHINA SOUTHN into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PICC Property and and CHINA SOUTHN AIR H , you can compare the effects of market volatilities on PICC Property and CHINA SOUTHN 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 PICC Property with a short position of CHINA SOUTHN. Check out your portfolio center. Please also check ongoing floating volatility patterns of PICC Property and CHINA SOUTHN.

Diversification Opportunities for PICC Property and CHINA SOUTHN

0.03

Correlation Coefficient

PICC Property  CHINA SOUTHN

Significant diversification

The 3 months correlation between PICC and CHINA is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding PICC Property and and CHINA SOUTHN AIR H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA SOUTHN AIR and PICC Property 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 PICC Property and are associated (or correlated) with CHINA SOUTHN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA SOUTHN AIR has no effect on the direction of PICC Property i.e., PICC Property and CHINA SOUTHN go up and down completely randomly.

Pair Corralation between PICC Property and CHINA SOUTHN

Assuming the 90 days horizon PICC Property and is expected to generate 0.98 times more return on investment than CHINA SOUTHN. However, PICC Property and is 1.02 times less risky than CHINA SOUTHN. It trades about 0.16 of its potential returns per unit of risk. CHINA SOUTHN AIR H is currently generating about 0.01 per unit of risk. If you would invest  164.00  in PICC Property and on May 24, 2025 and sell it today you would earn a total of  40.00  from holding PICC Property and or generate 24.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

PICC Property and  vs.  CHINA SOUTHN AIR H

PICC Property

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in PICC Property and are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, PICC Property reported solid returns over the last few months and may actually be approaching a breakup point.

CHINA SOUTHN AIR

Risk-Adjusted Performance

Weak

Over the last 90 days CHINA SOUTHN AIR H has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CHINA SOUTHN is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with PICC Property and CHINA SOUTHN

The main advantage of trading using opposite PICC Property and CHINA SOUTHN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PICC Property position performs unexpectedly, CHINA SOUTHN 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 CHINA SOUTHN will offset losses from the drop in CHINA SOUTHN's long position.

The idea behind PICC Property and and CHINA SOUTHN AIR H 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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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.