Correlation Between Beijing Shunxin and Guangzhou Boji
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By analyzing existing cross correlation between Beijing Shunxin Agriculture and Guangzhou Boji Medical, you can compare the effects of market volatilities on Beijing Shunxin and Guangzhou Boji 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 Beijing Shunxin with a short position of Guangzhou Boji. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Shunxin and Guangzhou Boji.
Diversification Opportunities for Beijing Shunxin and Guangzhou Boji
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Guangzhou is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Shunxin Agriculture and Guangzhou Boji Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Boji Medical and Beijing Shunxin 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 Beijing Shunxin Agriculture are associated (or correlated) with Guangzhou Boji. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Boji Medical has no effect on the direction of Beijing Shunxin i.e., Beijing Shunxin and Guangzhou Boji go up and down completely randomly.
Pair Corralation between Beijing Shunxin and Guangzhou Boji
Assuming the 90 days trading horizon Beijing Shunxin is expected to generate 2.83 times less return on investment than Guangzhou Boji. But when comparing it to its historical volatility, Beijing Shunxin Agriculture is 1.09 times less risky than Guangzhou Boji. It trades about 0.02 of its potential returns per unit of risk. Guangzhou Boji Medical is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 749.00 in Guangzhou Boji Medical on October 18, 2024 and sell it today you would earn a total of 76.00 from holding Guangzhou Boji Medical or generate 10.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Shunxin Agriculture vs. Guangzhou Boji Medical
Performance |
| Timeline |
| Beijing Shunxin Agri |
| Guangzhou Boji Medical |
Beijing Shunxin and Guangzhou Boji Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Shunxin and Guangzhou Boji
The main advantage of trading using opposite Beijing Shunxin and Guangzhou Boji positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Shunxin position performs unexpectedly, Guangzhou Boji 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 Boji will offset losses from the drop in Guangzhou Boji's long position.| Beijing Shunxin vs. Chongqing Changan Automobile | Beijing Shunxin vs. Songz Automobile Air | Beijing Shunxin vs. Dongfeng Automobile Co | Beijing Shunxin vs. Anhui Jianghuai Automobile |
| Guangzhou Boji vs. Kingclean Electric Co | Guangzhou Boji vs. Uroica Mining Safety | Guangzhou Boji vs. Beijing Shunxin Agriculture | Guangzhou Boji vs. Keda Clean Energy |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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