Correlation Between GRG Banking and Huatian Hotel
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By analyzing existing cross correlation between GRG Banking Equipment and Huatian Hotel Group, you can compare the effects of market volatilities on GRG Banking and Huatian Hotel 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 GRG Banking with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRG Banking and Huatian Hotel.
Diversification Opportunities for GRG Banking and Huatian Hotel
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GRG and Huatian is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding GRG Banking Equipment and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and GRG Banking 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 GRG Banking Equipment are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of GRG Banking i.e., GRG Banking and Huatian Hotel go up and down completely randomly.
Pair Corralation between GRG Banking and Huatian Hotel
Assuming the 90 days trading horizon GRG Banking Equipment is expected to generate 0.58 times more return on investment than Huatian Hotel. However, GRG Banking Equipment is 1.72 times less risky than Huatian Hotel. It trades about -0.53 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about -0.42 per unit of risk. If you would invest 1,310 in GRG Banking Equipment on October 13, 2024 and sell it today you would lose (250.00) from holding GRG Banking Equipment or give up 19.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRG Banking Equipment vs. Huatian Hotel Group
Performance |
| Timeline |
| GRG Banking Equipment |
| Huatian Hotel Group |
GRG Banking and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRG Banking and Huatian Hotel
The main advantage of trading using opposite GRG Banking and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRG Banking position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| GRG Banking vs. Sunwave Communications Co | GRG Banking vs. China Sports Industry | GRG Banking vs. Shanghai Yaoji Playing | GRG Banking vs. Guangzhou Dongfang Hotel |
| Huatian Hotel vs. Unisplendour Corp | Huatian Hotel vs. Jinling Hotel Corp | Huatian Hotel vs. Industrial Bank Co | Huatian Hotel vs. GRG Banking Equipment |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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