Correlation Between China Securities and Guangzhou Risong
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By analyzing existing cross correlation between China Securities 800 and Guangzhou Risong Intelligent, you can compare the effects of market volatilities on China Securities and Guangzhou Risong 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 Guangzhou Risong. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Guangzhou Risong.
Diversification Opportunities for China Securities and Guangzhou Risong
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Guangzhou is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Guangzhou Risong Intelligent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Risong Int 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 Guangzhou Risong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Risong Int has no effect on the direction of China Securities i.e., China Securities and Guangzhou Risong go up and down completely randomly.
Pair Corralation between China Securities and Guangzhou Risong
Assuming the 90 days trading horizon China Securities is expected to generate 35.52 times less return on investment than Guangzhou Risong. But when comparing it to its historical volatility, China Securities 800 is 4.03 times less risky than Guangzhou Risong. It trades about 0.01 of its potential returns per unit of risk. Guangzhou Risong Intelligent is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,512 in Guangzhou Risong Intelligent on November 3, 2024 and sell it today you would earn a total of 226.00 from holding Guangzhou Risong Intelligent or generate 6.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Guangzhou Risong Intelligent
Performance |
| Timeline |
China Securities and Guangzhou Risong Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Guangzhou Risong Intelligent
Pair trading matchups for Guangzhou Risong
Pair Trading with China Securities and Guangzhou Risong
The main advantage of trading using opposite China Securities and Guangzhou Risong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Guangzhou Risong 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 Risong will offset losses from the drop in Guangzhou Risong's long position.| China Securities vs. China Securities 500 | China Securities vs. Shanghai SE A | China Securities vs. SZSE Composite | China Securities vs. SSE 180 Index |
| Guangzhou Risong vs. Guangzhou Dongfang Hotel | Guangzhou Risong vs. Touchstone International Medical | Guangzhou Risong vs. Huatian Hotel Group | Guangzhou Risong vs. Kontour Medical Technology |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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