Correlation Between China Baoan and Guangzhou Restaurants
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By analyzing existing cross correlation between China Baoan Group and Guangzhou Restaurants Group, you can compare the effects of market volatilities on China Baoan and Guangzhou Restaurants 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 Baoan with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Baoan and Guangzhou Restaurants.
Diversification Opportunities for China Baoan and Guangzhou Restaurants
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Guangzhou is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding China Baoan Group and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and China Baoan 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 Baoan Group are associated (or correlated) with Guangzhou Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Restaurants has no effect on the direction of China Baoan i.e., China Baoan and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between China Baoan and Guangzhou Restaurants
Assuming the 90 days trading horizon China Baoan Group is expected to generate 1.11 times more return on investment than Guangzhou Restaurants. However, China Baoan is 1.11 times more volatile than Guangzhou Restaurants Group. It trades about -0.03 of its potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about -0.04 per unit of risk. If you would invest 1,247 in China Baoan Group on October 29, 2024 and sell it today you would lose (416.00) from holding China Baoan Group or give up 33.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
China Baoan Group vs. Guangzhou Restaurants Group
Performance |
| Timeline |
| China Baoan Group |
| Guangzhou Restaurants |
China Baoan and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Baoan and Guangzhou Restaurants
The main advantage of trading using opposite China Baoan and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Baoan position performs unexpectedly, Guangzhou Restaurants 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 Guangzhou Restaurants will offset losses from the drop in Guangzhou Restaurants' long position.| China Baoan vs. Queclink Wireless Solutions | China Baoan vs. Dhc Software Co | China Baoan vs. Sharetronic Data Technology | China Baoan vs. Jilin Jlu Communication |
| Guangzhou Restaurants vs. Huizhou Speed Wireless | Guangzhou Restaurants vs. Grandblue Environment Co | Guangzhou Restaurants vs. Panda Financial Holding | Guangzhou Restaurants vs. Beijing Kingsoft Office |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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