Correlation Between Guangzhou Dongfang and Gifore Agricultural
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By analyzing existing cross correlation between Guangzhou Dongfang Hotel and Gifore Agricultural Machinery, you can compare the effects of market volatilities on Guangzhou Dongfang and Gifore Agricultural 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 Guangzhou Dongfang with a short position of Gifore Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Dongfang and Gifore Agricultural.
Diversification Opportunities for Guangzhou Dongfang and Gifore Agricultural
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Gifore is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Dongfang Hotel and Gifore Agricultural Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gifore Agricultural and Guangzhou Dongfang 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 Guangzhou Dongfang Hotel are associated (or correlated) with Gifore Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gifore Agricultural has no effect on the direction of Guangzhou Dongfang i.e., Guangzhou Dongfang and Gifore Agricultural go up and down completely randomly.
Pair Corralation between Guangzhou Dongfang and Gifore Agricultural
Assuming the 90 days trading horizon Guangzhou Dongfang is expected to generate 3.87 times less return on investment than Gifore Agricultural. In addition to that, Guangzhou Dongfang is 1.08 times more volatile than Gifore Agricultural Machinery. It trades about 0.0 of its total potential returns per unit of risk. Gifore Agricultural Machinery is currently generating about 0.02 per unit of volatility. If you would invest 506.00 in Gifore Agricultural Machinery on September 12, 2024 and sell it today you would earn a total of 12.00 from holding Gifore Agricultural Machinery or generate 2.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Dongfang Hotel vs. Gifore Agricultural Machinery
Performance |
| Timeline |
| Guangzhou Dongfang Hotel |
| Gifore Agricultural |
Guangzhou Dongfang and Gifore Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Dongfang and Gifore Agricultural
The main advantage of trading using opposite Guangzhou Dongfang and Gifore Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Dongfang position performs unexpectedly, Gifore Agricultural 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 Gifore Agricultural will offset losses from the drop in Gifore Agricultural's long position.| Guangzhou Dongfang vs. Lutian Machinery Co | Guangzhou Dongfang vs. PetroChina Co Ltd | Guangzhou Dongfang vs. Bank of China | Guangzhou Dongfang vs. Gansu Jiu Steel |
| Gifore Agricultural vs. Impulse Qingdao Health | Gifore Agricultural vs. Guangzhou Dongfang Hotel | Gifore Agricultural vs. PKU HealthCare Corp | Gifore Agricultural vs. China World Trade |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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