Correlation Between Xiwang Foodstuffs and Guangzhou Dongfang
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By analyzing existing cross correlation between Xiwang Foodstuffs Co and Guangzhou Dongfang Hotel, you can compare the effects of market volatilities on Xiwang Foodstuffs and Guangzhou Dongfang 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 Xiwang Foodstuffs with a short position of Guangzhou Dongfang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiwang Foodstuffs and Guangzhou Dongfang.
Diversification Opportunities for Xiwang Foodstuffs and Guangzhou Dongfang
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Xiwang and Guangzhou is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Xiwang Foodstuffs Co and Guangzhou Dongfang Hotel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Dongfang Hotel and Xiwang Foodstuffs 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 Xiwang Foodstuffs Co are associated (or correlated) with Guangzhou Dongfang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Dongfang Hotel has no effect on the direction of Xiwang Foodstuffs i.e., Xiwang Foodstuffs and Guangzhou Dongfang go up and down completely randomly.
Pair Corralation between Xiwang Foodstuffs and Guangzhou Dongfang
Assuming the 90 days trading horizon Xiwang Foodstuffs Co is expected to under-perform the Guangzhou Dongfang. In addition to that, Xiwang Foodstuffs is 1.52 times more volatile than Guangzhou Dongfang Hotel. It trades about -0.26 of its total potential returns per unit of risk. Guangzhou Dongfang Hotel is currently generating about -0.05 per unit of volatility. If you would invest 968.00 in Guangzhou Dongfang Hotel on November 1, 2024 and sell it today you would lose (23.00) from holding Guangzhou Dongfang Hotel or give up 2.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiwang Foodstuffs Co vs. Guangzhou Dongfang Hotel
Performance |
| Timeline |
| Xiwang Foodstuffs |
| Guangzhou Dongfang Hotel |
Xiwang Foodstuffs and Guangzhou Dongfang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiwang Foodstuffs and Guangzhou Dongfang
The main advantage of trading using opposite Xiwang Foodstuffs and Guangzhou Dongfang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiwang Foodstuffs position performs unexpectedly, Guangzhou Dongfang 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 Dongfang will offset losses from the drop in Guangzhou Dongfang's long position.| Xiwang Foodstuffs vs. HeBei Jinniu Chemical | Xiwang Foodstuffs vs. Longjian Road Bridge | Xiwang Foodstuffs vs. Zhengping RoadBridge Constr | Xiwang Foodstuffs vs. Chengdu Xinzhu RoadBridge |
| Guangzhou Dongfang vs. Gan Yuan Foods | Guangzhou Dongfang vs. Xiwang Foodstuffs Co | Guangzhou Dongfang vs. China Satellite Communications | Guangzhou Dongfang vs. Guangdong Wens Foodstuff |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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