Correlation Between China Securities and Gan Yuan
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By analyzing existing cross correlation between China Securities 800 and Gan Yuan Foods, you can compare the effects of market volatilities on China Securities and Gan Yuan 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 China Securities with a short position of Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Gan Yuan.
Diversification Opportunities for China Securities and Gan Yuan
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Gan is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods and China Securities 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 China Securities 800 are associated (or correlated) with Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of China Securities i.e., China Securities and Gan Yuan go up and down completely randomly.
Pair Corralation between China Securities and Gan Yuan
Assuming the 90 days trading horizon China Securities is expected to generate 3.15 times less return on investment than Gan Yuan. But when comparing it to its historical volatility, China Securities 800 is 1.2 times less risky than Gan Yuan. It trades about 0.06 of its potential returns per unit of risk. Gan Yuan Foods is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 6,249 in Gan Yuan Foods on August 28, 2024 and sell it today you would earn a total of 1,213 from holding Gan Yuan Foods or generate 19.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Gan Yuan Foods
Performance |
| Timeline |
China Securities and Gan Yuan Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Gan Yuan Foods
Pair trading matchups for Gan Yuan
Pair Trading with China Securities and Gan Yuan
The main advantage of trading using opposite China Securities and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.| China Securities vs. Shandong Ruifeng Chemical | China Securities vs. Zhongtong Guomai Communication | China Securities vs. Gome Telecom Equipment | China Securities vs. Dymatic Chemicals |
| Gan Yuan vs. Marssenger Kitchenware Co | Gan Yuan vs. XinJiang GuoTong Pipeline | Gan Yuan vs. Yindu Kitchen Equipment | Gan Yuan vs. Zhejiang Kingland Pipeline |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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