Correlation Between ChengDu Hi and Guangzhou KingTeller
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By analyzing existing cross correlation between ChengDu Hi Tech Development and Guangzhou KingTeller Technology, you can compare the effects of market volatilities on ChengDu Hi and Guangzhou KingTeller 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 ChengDu Hi with a short position of Guangzhou KingTeller. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChengDu Hi and Guangzhou KingTeller.
Diversification Opportunities for ChengDu Hi and Guangzhou KingTeller
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ChengDu and Guangzhou is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding ChengDu Hi Tech Development and Guangzhou KingTeller Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou KingTeller and ChengDu Hi 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 ChengDu Hi Tech Development are associated (or correlated) with Guangzhou KingTeller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou KingTeller has no effect on the direction of ChengDu Hi i.e., ChengDu Hi and Guangzhou KingTeller go up and down completely randomly.
Pair Corralation between ChengDu Hi and Guangzhou KingTeller
Assuming the 90 days trading horizon ChengDu Hi is expected to generate 1.57 times less return on investment than Guangzhou KingTeller. In addition to that, ChengDu Hi is 1.04 times more volatile than Guangzhou KingTeller Technology. It trades about 0.19 of its total potential returns per unit of risk. Guangzhou KingTeller Technology is currently generating about 0.3 per unit of volatility. If you would invest 322.00 in Guangzhou KingTeller Technology on September 13, 2024 and sell it today you would earn a total of 341.00 from holding Guangzhou KingTeller Technology or generate 105.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChengDu Hi Tech Development vs. Guangzhou KingTeller Technolog
Performance |
| Timeline |
| ChengDu Hi Tech |
| Guangzhou KingTeller |
ChengDu Hi and Guangzhou KingTeller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChengDu Hi and Guangzhou KingTeller
The main advantage of trading using opposite ChengDu Hi and Guangzhou KingTeller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChengDu Hi position performs unexpectedly, Guangzhou KingTeller 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 KingTeller will offset losses from the drop in Guangzhou KingTeller's long position.| ChengDu Hi vs. China Life Insurance | ChengDu Hi vs. Cinda Securities Co | ChengDu Hi vs. Piotech Inc A | ChengDu Hi vs. Dongxing Sec 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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