Correlation Between Guangzhou Seagull and Qingdao Foods
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By analyzing existing cross correlation between Guangzhou Seagull Kitchen and Qingdao Foods Co, you can compare the effects of market volatilities on Guangzhou Seagull and Qingdao Foods 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 Guangzhou Seagull with a short position of Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Seagull and Qingdao Foods.
Diversification Opportunities for Guangzhou Seagull and Qingdao Foods
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and Qingdao is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Seagull Kitchen and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods and Guangzhou Seagull 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 Guangzhou Seagull Kitchen are associated (or correlated) with Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Guangzhou Seagull i.e., Guangzhou Seagull and Qingdao Foods go up and down completely randomly.
Pair Corralation between Guangzhou Seagull and Qingdao Foods
Assuming the 90 days trading horizon Guangzhou Seagull Kitchen is expected to under-perform the Qingdao Foods. In addition to that, Guangzhou Seagull is 1.22 times more volatile than Qingdao Foods Co. It trades about -0.02 of its total potential returns per unit of risk. Qingdao Foods Co is currently generating about 0.01 per unit of volatility. If you would invest 1,386 in Qingdao Foods Co on October 12, 2024 and sell it today you would lose (61.00) from holding Qingdao Foods Co or give up 4.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Guangzhou Seagull Kitchen vs. Qingdao Foods Co
Performance |
| Timeline |
| Guangzhou Seagull Kitchen |
| Qingdao Foods |
Guangzhou Seagull and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Seagull and Qingdao Foods
The main advantage of trading using opposite Guangzhou Seagull and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Seagull position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Guangzhou Seagull vs. Unisplendour Corp | Guangzhou Seagull vs. Zhejiang JIULI Hi tech | Guangzhou Seagull vs. Ningbo Fujia Industrial | Guangzhou Seagull vs. FSPG Hi Tech Co |
| Qingdao Foods vs. Shenyang Chemical Industry | Qingdao Foods vs. Jilin Chemical Fibre | Qingdao Foods vs. Heilongjiang Publishing Media | Qingdao Foods vs. Hainan Airlines Co |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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