Correlation Between China Merchants and Guangzhou Jinyi
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By analyzing existing cross correlation between China Merchants Shekou and Guangzhou Jinyi Media, you can compare the effects of market volatilities on China Merchants and Guangzhou Jinyi 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 Merchants with a short position of Guangzhou Jinyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Guangzhou Jinyi.
Diversification Opportunities for China Merchants and Guangzhou Jinyi
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Guangzhou is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Guangzhou Jinyi Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Jinyi Media and China Merchants 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 Merchants Shekou are associated (or correlated) with Guangzhou Jinyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Jinyi Media has no effect on the direction of China Merchants i.e., China Merchants and Guangzhou Jinyi go up and down completely randomly.
Pair Corralation between China Merchants and Guangzhou Jinyi
Assuming the 90 days trading horizon China Merchants Shekou is expected to under-perform the Guangzhou Jinyi. But the stock apears to be less risky and, when comparing its historical volatility, China Merchants Shekou is 1.69 times less risky than Guangzhou Jinyi. The stock trades about -0.08 of its potential returns per unit of risk. The Guangzhou Jinyi Media is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 705.00 in Guangzhou Jinyi Media on September 13, 2024 and sell it today you would earn a total of 183.00 from holding Guangzhou Jinyi Media or generate 25.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Guangzhou Jinyi Media
Performance |
| Timeline |
| China Merchants Shekou |
| Guangzhou Jinyi Media |
China Merchants and Guangzhou Jinyi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Guangzhou Jinyi
The main advantage of trading using opposite China Merchants and Guangzhou Jinyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Guangzhou Jinyi 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 Jinyi will offset losses from the drop in Guangzhou Jinyi's long position.| China Merchants vs. Shandong Publishing Media | China Merchants vs. Offshore Oil Engineering | China Merchants vs. Xinjiang Beixin RoadBridge | China Merchants vs. Beijing Kaiwen Education |
| Guangzhou Jinyi vs. PKU HealthCare Corp | Guangzhou Jinyi vs. Shenzhen Topway Video | Guangzhou Jinyi vs. Kuangda Technology Group | Guangzhou Jinyi vs. Niutech Environment 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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