Correlation Between Changchun High and Guangzhou Restaurants
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By analyzing existing cross correlation between Changchun High New and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Changchun High 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 Changchun High with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun High and Guangzhou Restaurants.
Diversification Opportunities for Changchun High and Guangzhou Restaurants
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and Guangzhou is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Changchun High New and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Changchun High 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 Changchun High New 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 Changchun High i.e., Changchun High and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Changchun High and Guangzhou Restaurants
Assuming the 90 days trading horizon Changchun High New is expected to under-perform the Guangzhou Restaurants. In addition to that, Changchun High is 1.19 times more volatile than Guangzhou Restaurants Group. It trades about -0.03 of its total potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about -0.03 per unit of volatility. If you would invest 2,460 in Guangzhou Restaurants Group on September 3, 2024 and sell it today you would lose (807.00) from holding Guangzhou Restaurants Group or give up 32.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun High New vs. Guangzhou Restaurants Group
Performance |
| Timeline |
| Changchun High New |
| Guangzhou Restaurants |
Changchun High and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun High and Guangzhou Restaurants
The main advantage of trading using opposite Changchun High and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun High 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.| Changchun High vs. Guangzhou Restaurants Group | Changchun High vs. Suzhou Douson Drilling | Changchun High vs. Beijing Sanyuan Foods | Changchun High vs. Kingsignal Technology Co |
| Guangzhou Restaurants vs. PetroChina Co Ltd | Guangzhou Restaurants vs. China Mobile Limited | Guangzhou Restaurants vs. Industrial and Commercial | Guangzhou Restaurants vs. China Life Insurance |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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