Correlation Between China Securities and Guangdong Marubi
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By analyzing existing cross correlation between China Securities 800 and Guangdong Marubi Biotechnology, you can compare the effects of market volatilities on China Securities and Guangdong Marubi 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 Guangdong Marubi. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Guangdong Marubi.
Diversification Opportunities for China Securities and Guangdong Marubi
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Guangdong is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Guangdong Marubi Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Marubi Bio 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 Guangdong Marubi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Marubi Bio has no effect on the direction of China Securities i.e., China Securities and Guangdong Marubi go up and down completely randomly.
Pair Corralation between China Securities and Guangdong Marubi
Assuming the 90 days trading horizon China Securities 800 is expected to generate 0.6 times more return on investment than Guangdong Marubi. However, China Securities 800 is 1.67 times less risky than Guangdong Marubi. It trades about -0.03 of its potential returns per unit of risk. Guangdong Marubi Biotechnology is currently generating about -0.13 per unit of risk. If you would invest 422,167 in China Securities 800 on August 25, 2024 and sell it today you would lose (4,615) from holding China Securities 800 or give up 1.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Guangdong Marubi Biotechnology
Performance |
| Timeline |
China Securities and Guangdong Marubi Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Guangdong Marubi Biotechnology
Pair trading matchups for Guangdong Marubi
Pair Trading with China Securities and Guangdong Marubi
The main advantage of trading using opposite China Securities and Guangdong Marubi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Guangdong Marubi 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 Guangdong Marubi will offset losses from the drop in Guangdong Marubi's long position.| China Securities vs. Yuan Longping High tech | China Securities vs. Saurer Intelligent Technology | China Securities vs. Fujian Rongji Software | China Securities vs. Jinhui Liquor Co |
| Guangdong Marubi vs. Guangdong Brandmax Marketing | Guangdong Marubi vs. AVCON Information Tech | Guangdong Marubi vs. Focus Media Information | Guangdong Marubi vs. Gansu Huangtai Wine marketing |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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