Correlation Between Guangdong Jingyi and Gome Telecom
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By analyzing existing cross correlation between Guangdong Jingyi Metal and Gome Telecom Equipment, you can compare the effects of market volatilities on Guangdong Jingyi 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 Guangdong Jingyi with a short position of Gome Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jingyi and Gome Telecom.
Diversification Opportunities for Guangdong Jingyi and Gome Telecom
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangdong and Gome is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jingyi Metal 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 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 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 Guangdong Jingyi i.e., Guangdong Jingyi and Gome Telecom go up and down completely randomly.
Pair Corralation between Guangdong Jingyi and Gome Telecom
Assuming the 90 days trading horizon Guangdong Jingyi Metal is expected to generate 1.13 times more return on investment than Gome Telecom. However, Guangdong Jingyi is 1.13 times more volatile than Gome Telecom Equipment. It trades about -0.03 of its potential returns per unit of risk. Gome Telecom Equipment is currently generating about -1.12 per unit of risk. If you would invest 696.00 in Guangdong Jingyi Metal on October 25, 2024 and sell it today you would lose (16.00) from holding Guangdong Jingyi Metal or give up 2.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jingyi Metal vs. Gome Telecom Equipment
Performance |
| Timeline |
| Guangdong Jingyi Metal |
| Gome Telecom Equipment |
Guangdong Jingyi and Gome Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jingyi and Gome Telecom
The main advantage of trading using opposite Guangdong Jingyi and Gome Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jingyi 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.| Guangdong Jingyi vs. Zijin Mining Group | Guangdong Jingyi vs. Wanhua Chemical Group | Guangdong Jingyi vs. Baoshan Iron Steel | Guangdong Jingyi vs. Rongsheng Petrochemical Co |
| Gome Telecom vs. PetroChina Co Ltd | Gome Telecom vs. Gansu Jiu Steel | Gome Telecom vs. Ming Yang Smart | Gome Telecom vs. Aba Chemicals Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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