Correlation Between Lander Sports and Guangzhou Restaurants
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By analyzing existing cross correlation between Lander Sports Development and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Lander Sports 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 Lander Sports with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lander Sports and Guangzhou Restaurants.
Diversification Opportunities for Lander Sports and Guangzhou Restaurants
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lander and Guangzhou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Lander Sports Development and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Lander Sports 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 Lander Sports Development 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 Lander Sports i.e., Lander Sports and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Lander Sports and Guangzhou Restaurants
Assuming the 90 days trading horizon Lander Sports is expected to generate 7.18 times less return on investment than Guangzhou Restaurants. In addition to that, Lander Sports is 1.64 times more volatile than Guangzhou Restaurants Group. It trades about 0.01 of its total potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about 0.11 per unit of volatility. If you would invest 1,553 in Guangzhou Restaurants Group on August 30, 2024 and sell it today you would earn a total of 67.00 from holding Guangzhou Restaurants Group or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lander Sports Development vs. Guangzhou Restaurants Group
Performance |
| Timeline |
| Lander Sports Development |
| Guangzhou Restaurants |
Lander Sports and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lander Sports and Guangzhou Restaurants
The main advantage of trading using opposite Lander Sports and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lander Sports 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.| Lander Sports vs. Western Mining Co | Lander Sports vs. Zijin Mining Group | Lander Sports vs. Huaibei Mining Holdings | Lander Sports vs. Shuhua Sports Co |
| Guangzhou Restaurants vs. China Petroleum Chemical | Guangzhou Restaurants vs. PetroChina Co Ltd | Guangzhou Restaurants vs. China State Construction | Guangzhou Restaurants vs. China Railway Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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