Correlation Between Guangzhou Dongfang and Puya Semiconductor
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By analyzing existing cross correlation between Guangzhou Dongfang Hotel and Puya Semiconductor Shanghai, you can compare the effects of market volatilities on Guangzhou Dongfang and Puya Semiconductor 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 Puya Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Dongfang and Puya Semiconductor.
Diversification Opportunities for Guangzhou Dongfang and Puya Semiconductor
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Guangzhou and Puya is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Dongfang Hotel and Puya Semiconductor Shanghai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puya Semiconductor 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 Puya Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puya Semiconductor has no effect on the direction of Guangzhou Dongfang i.e., Guangzhou Dongfang and Puya Semiconductor go up and down completely randomly.
Pair Corralation between Guangzhou Dongfang and Puya Semiconductor
Assuming the 90 days trading horizon Guangzhou Dongfang Hotel is expected to under-perform the Puya Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Dongfang Hotel is 1.88 times less risky than Puya Semiconductor. The stock trades about -0.06 of its potential returns per unit of risk. The Puya Semiconductor Shanghai is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 11,435 in Puya Semiconductor Shanghai on October 23, 2024 and sell it today you would earn a total of 465.00 from holding Puya Semiconductor Shanghai or generate 4.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Guangzhou Dongfang Hotel vs. Puya Semiconductor Shanghai
Performance |
| Timeline |
| Guangzhou Dongfang Hotel |
| Puya Semiconductor |
Guangzhou Dongfang and Puya Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Dongfang and Puya Semiconductor
The main advantage of trading using opposite Guangzhou Dongfang and Puya Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Dongfang position performs unexpectedly, Puya Semiconductor 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 Puya Semiconductor will offset losses from the drop in Puya Semiconductor's long position.| Guangzhou Dongfang vs. Industrial Bank Co | Guangzhou Dongfang vs. Humanwell Healthcare Group | Guangzhou Dongfang vs. China Everbright Bank | Guangzhou Dongfang vs. Hua Xia Bank |
| Puya Semiconductor vs. YiDong Electronics Technology | Puya Semiconductor vs. Jiangyin Jianghua Microelectronics | Puya Semiconductor vs. Epoxy Base Electronic | Puya Semiconductor vs. Jinhui Mining Co |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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