Correlation Between Guangzhou KingTeller and Gome Telecom
Specify exactly 2 symbols:
By analyzing existing cross correlation between Guangzhou KingTeller Technology and Gome Telecom Equipment, you can compare the effects of market volatilities on Guangzhou KingTeller and Gome Telecom 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 KingTeller with a short position of Gome Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou KingTeller and Gome Telecom.
Diversification Opportunities for Guangzhou KingTeller and Gome Telecom
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and Gome is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou KingTeller Technolog and Gome Telecom Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gome Telecom Equipment and Guangzhou KingTeller 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 KingTeller Technology are associated (or correlated) with Gome Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gome Telecom Equipment has no effect on the direction of Guangzhou KingTeller i.e., Guangzhou KingTeller and Gome Telecom go up and down completely randomly.
Pair Corralation between Guangzhou KingTeller and Gome Telecom
Assuming the 90 days trading horizon Guangzhou KingTeller Technology is expected to generate 1.07 times more return on investment than Gome Telecom. However, Guangzhou KingTeller is 1.07 times more volatile than Gome Telecom Equipment. It trades about 0.05 of its potential returns per unit of risk. Gome Telecom Equipment is currently generating about -0.06 per unit of risk. If you would invest 321.00 in Guangzhou KingTeller Technology on September 5, 2024 and sell it today you would earn a total of 189.00 from holding Guangzhou KingTeller Technology or generate 58.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou KingTeller Technolog vs. Gome Telecom Equipment
Performance |
| Timeline |
| Guangzhou KingTeller |
| Gome Telecom Equipment |
Guangzhou KingTeller and Gome Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou KingTeller and Gome Telecom
The main advantage of trading using opposite Guangzhou KingTeller and Gome Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou KingTeller position performs unexpectedly, Gome Telecom 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 Gome Telecom will offset losses from the drop in Gome Telecom's long position.The idea behind Guangzhou KingTeller Technology and Gome Telecom Equipment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Gome Telecom vs. Guangzhou KingTeller Technology | Gome Telecom vs. Hoshine Silicon Ind | Gome Telecom vs. Kingsignal Technology Co | Gome Telecom vs. Kangping Technology 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |