Correlation Between Guangdong Jingyi and Guangzhou Ruoyuchen
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By analyzing existing cross correlation between Guangdong Jingyi Metal and Guangzhou Ruoyuchen Information, you can compare the effects of market volatilities on Guangdong Jingyi and Guangzhou Ruoyuchen 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 Guangdong Jingyi with a short position of Guangzhou Ruoyuchen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jingyi and Guangzhou Ruoyuchen.
Diversification Opportunities for Guangdong Jingyi and Guangzhou Ruoyuchen
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Guangzhou is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jingyi Metal and Guangzhou Ruoyuchen Informatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Ruoyuchen and Guangdong Jingyi 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 Guangdong Jingyi Metal are associated (or correlated) with Guangzhou Ruoyuchen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Ruoyuchen has no effect on the direction of Guangdong Jingyi i.e., Guangdong Jingyi and Guangzhou Ruoyuchen go up and down completely randomly.
Pair Corralation between Guangdong Jingyi and Guangzhou Ruoyuchen
Assuming the 90 days trading horizon Guangdong Jingyi is expected to generate 3.92 times less return on investment than Guangzhou Ruoyuchen. But when comparing it to its historical volatility, Guangdong Jingyi Metal is 2.93 times less risky than Guangzhou Ruoyuchen. It trades about 0.22 of its potential returns per unit of risk. Guangzhou Ruoyuchen Information is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 1,730 in Guangzhou Ruoyuchen Information on September 12, 2024 and sell it today you would earn a total of 524.00 from holding Guangzhou Ruoyuchen Information or generate 30.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Guangdong Jingyi Metal vs. Guangzhou Ruoyuchen Informatio
Performance |
| Timeline |
| Guangdong Jingyi Metal |
| Guangzhou Ruoyuchen |
Guangdong Jingyi and Guangzhou Ruoyuchen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jingyi and Guangzhou Ruoyuchen
The main advantage of trading using opposite Guangdong Jingyi and Guangzhou Ruoyuchen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jingyi position performs unexpectedly, Guangzhou Ruoyuchen 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 Guangzhou Ruoyuchen will offset losses from the drop in Guangzhou Ruoyuchen's long position.| Guangdong Jingyi vs. Zijin Mining Group | Guangdong Jingyi vs. Wanhua Chemical Group | Guangdong Jingyi vs. Baoshan Iron Steel | Guangdong Jingyi vs. Rongsheng Petrochemical Co |
| Guangzhou Ruoyuchen vs. Kweichow Moutai Co | Guangzhou Ruoyuchen vs. Shenzhen Mindray Bio Medical | Guangzhou Ruoyuchen vs. G bits Network Technology | Guangzhou Ruoyuchen vs. Beijing Roborock Technology |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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