Correlation Between Yuan Longping and Guangdong Qunxing
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By analyzing existing cross correlation between Yuan Longping High tech and Guangdong Qunxing Toys, you can compare the effects of market volatilities on Yuan Longping and Guangdong Qunxing 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 Yuan Longping with a short position of Guangdong Qunxing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan Longping and Guangdong Qunxing.
Diversification Opportunities for Yuan Longping and Guangdong Qunxing
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Yuan and Guangdong is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Yuan Longping High tech and Guangdong Qunxing Toys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Qunxing Toys and Yuan Longping 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 Yuan Longping High tech are associated (or correlated) with Guangdong Qunxing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Qunxing Toys has no effect on the direction of Yuan Longping i.e., Yuan Longping and Guangdong Qunxing go up and down completely randomly.
Pair Corralation between Yuan Longping and Guangdong Qunxing
Assuming the 90 days trading horizon Yuan Longping High tech is expected to generate 0.4 times more return on investment than Guangdong Qunxing. However, Yuan Longping High tech is 2.49 times less risky than Guangdong Qunxing. It trades about -0.2 of its potential returns per unit of risk. Guangdong Qunxing Toys is currently generating about -0.29 per unit of risk. If you would invest 1,084 in Yuan Longping High tech on November 3, 2024 and sell it today you would lose (64.00) from holding Yuan Longping High tech or give up 5.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuan Longping High tech vs. Guangdong Qunxing Toys
Performance |
| Timeline |
| Yuan Longping High |
| Guangdong Qunxing Toys |
Yuan Longping and Guangdong Qunxing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuan Longping and Guangdong Qunxing
The main advantage of trading using opposite Yuan Longping and Guangdong Qunxing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuan Longping position performs unexpectedly, Guangdong Qunxing 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 Qunxing will offset losses from the drop in Guangdong Qunxing's long position.| Yuan Longping vs. Bus Online Co | Yuan Longping vs. Holitech Technology Co | Yuan Longping vs. Gome Telecom Equipment | Yuan Longping vs. Cultural Investment Holdings |
| Guangdong Qunxing vs. China Life Insurance | Guangdong Qunxing vs. National Silicon Industry | Guangdong Qunxing vs. Shanghai OPM Biosciences | Guangdong Qunxing vs. Nanhua Bio Medicine |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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