Correlation Between Allwin Telecommunicatio and Guangxi Wuzhou
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By analyzing existing cross correlation between Allwin Telecommunication Co and Guangxi Wuzhou Communications, you can compare the effects of market volatilities on Allwin Telecommunicatio 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 Allwin Telecommunicatio with a short position of Guangxi Wuzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allwin Telecommunicatio and Guangxi Wuzhou.
Diversification Opportunities for Allwin Telecommunicatio and Guangxi Wuzhou
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Allwin and Guangxi is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Allwin Telecommunication Co 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 Allwin Telecommunicatio 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 Allwin Telecommunication Co 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 Allwin Telecommunicatio i.e., Allwin Telecommunicatio and Guangxi Wuzhou go up and down completely randomly.
Pair Corralation between Allwin Telecommunicatio and Guangxi Wuzhou
Assuming the 90 days trading horizon Allwin Telecommunication Co is expected to under-perform the Guangxi Wuzhou. But the stock apears to be less risky and, when comparing its historical volatility, Allwin Telecommunication Co is 1.17 times less risky than Guangxi Wuzhou. The stock trades about -0.28 of its potential returns per unit of risk. The Guangxi Wuzhou Communications is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 400.00 in Guangxi Wuzhou Communications on October 11, 2024 and sell it today you would earn a total of 35.00 from holding Guangxi Wuzhou Communications or generate 8.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allwin Telecommunication Co vs. Guangxi Wuzhou Communications
Performance |
| Timeline |
| Allwin Telecommunicatio |
| Guangxi Wuzhou Commu |
Allwin Telecommunicatio and Guangxi Wuzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allwin Telecommunicatio and Guangxi Wuzhou
The main advantage of trading using opposite Allwin Telecommunicatio and Guangxi Wuzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allwin Telecommunicatio 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.The idea behind Allwin Telecommunication Co and Guangxi Wuzhou Communications 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.
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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