Correlation Between China Merchants and Guangxi Wuzhou
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By analyzing existing cross correlation between China Merchants Shekou and Guangxi Wuzhou Communications, you can compare the effects of market volatilities on China Merchants and Guangxi Wuzhou 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 Guangxi Wuzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Guangxi Wuzhou.
Diversification Opportunities for China Merchants and Guangxi Wuzhou
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Guangxi is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Guangxi Wuzhou Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangxi Wuzhou Commu 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 Guangxi Wuzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangxi Wuzhou Commu has no effect on the direction of China Merchants i.e., China Merchants and Guangxi Wuzhou go up and down completely randomly.
Pair Corralation between China Merchants and Guangxi Wuzhou
Assuming the 90 days trading horizon China Merchants is expected to generate 5.76 times less return on investment than Guangxi Wuzhou. In addition to that, China Merchants is 1.28 times more volatile than Guangxi Wuzhou Communications. It trades about 0.0 of its total potential returns per unit of risk. Guangxi Wuzhou Communications is currently generating about 0.03 per unit of volatility. If you would invest 329.00 in Guangxi Wuzhou Communications on September 12, 2024 and sell it today you would earn a total of 71.00 from holding Guangxi Wuzhou Communications or generate 21.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Guangxi Wuzhou Communications
Performance |
| Timeline |
| China Merchants Shekou |
| Guangxi Wuzhou Commu |
China Merchants and Guangxi Wuzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Guangxi Wuzhou
The main advantage of trading using opposite China Merchants and Guangxi Wuzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Guangxi Wuzhou 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 Guangxi Wuzhou will offset losses from the drop in Guangxi Wuzhou's long position.| China Merchants vs. Chongqing Brewery Co | China Merchants vs. Duzhe Publishing Media | China Merchants vs. Chinese Universe Publishing | China Merchants vs. Zhejiang Publishing Media |
| Guangxi Wuzhou vs. Agricultural Bank of | Guangxi Wuzhou vs. Industrial and Commercial | Guangxi Wuzhou vs. Bank of China | Guangxi Wuzhou vs. PetroChina Co Ltd |
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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