Correlation Between Golden Bridge and Sang A
Can any of the company-specific risk be diversified away by investing in both Golden Bridge and Sang A at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Golden Bridge and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Bridge Investment and Sang A Frontec CoLtd, you can compare the effects of market volatilities on Golden Bridge and Sang A 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 Golden Bridge with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Bridge and Sang A.
Diversification Opportunities for Golden Bridge and Sang A
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Golden and Sang is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Golden Bridge Investment and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and Golden Bridge 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 Golden Bridge Investment are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of Golden Bridge i.e., Golden Bridge and Sang A go up and down completely randomly.
Pair Corralation between Golden Bridge and Sang A
Assuming the 90 days trading horizon Golden Bridge Investment is expected to generate 0.58 times more return on investment than Sang A. However, Golden Bridge Investment is 1.73 times less risky than Sang A. It trades about -0.09 of its potential returns per unit of risk. Sang A Frontec CoLtd is currently generating about -0.11 per unit of risk. If you would invest 47,300 in Golden Bridge Investment on September 28, 2024 and sell it today you would lose (4,000) from holding Golden Bridge Investment or give up 8.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Bridge Investment vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| Golden Bridge Investment |
| Sang A Frontec |
Golden Bridge and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Bridge and Sang A
The main advantage of trading using opposite Golden Bridge and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Bridge position performs unexpectedly, Sang A 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 Sang A will offset losses from the drop in Sang A's long position.| Golden Bridge vs. Dong A Steel Technology | Golden Bridge vs. Daou Technology | Golden Bridge vs. RF Materials Co | Golden Bridge vs. ENF Technology Co |
| Sang A vs. INSUN Environmental New | Sang A vs. Golden Bridge Investment | Sang A vs. Dong A Steel Technology | Sang A vs. Sangsangin Investment Securities |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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