Correlation Between Guangdong Jingyi and Eastern Communications
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By analyzing existing cross correlation between Guangdong Jingyi Metal and Eastern Communications Co, you can compare the effects of market volatilities on Guangdong Jingyi and Eastern Communications 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 Eastern Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jingyi and Eastern Communications.
Diversification Opportunities for Guangdong Jingyi and Eastern Communications
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Eastern is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jingyi Metal and Eastern Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Communications 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 Eastern Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Communications has no effect on the direction of Guangdong Jingyi i.e., Guangdong Jingyi and Eastern Communications go up and down completely randomly.
Pair Corralation between Guangdong Jingyi and Eastern Communications
Assuming the 90 days trading horizon Guangdong Jingyi is expected to generate 1.23 times less return on investment than Eastern Communications. But when comparing it to its historical volatility, Guangdong Jingyi Metal is 1.02 times less risky than Eastern Communications. It trades about 0.12 of its potential returns per unit of risk. Eastern Communications Co is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 29.00 in Eastern Communications Co on September 5, 2024 and sell it today you would earn a total of 14.00 from holding Eastern Communications Co or generate 48.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jingyi Metal vs. Eastern Communications Co
Performance |
| Timeline |
| Guangdong Jingyi Metal |
| Eastern Communications |
Guangdong Jingyi and Eastern Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jingyi and Eastern Communications
The main advantage of trading using opposite Guangdong Jingyi and Eastern Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jingyi position performs unexpectedly, Eastern Communications 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 Eastern Communications will offset losses from the drop in Eastern Communications' long position.| Guangdong Jingyi vs. Zijin Mining Group | Guangdong Jingyi vs. Wanhua Chemical Group | Guangdong Jingyi vs. Baoshan Iron Steel | Guangdong Jingyi vs. Shandong Gold Mining |
| Eastern Communications vs. Jiaozuo Wanfang Aluminum | Eastern Communications vs. ZYF Lopsking Aluminum | Eastern Communications vs. Datang HuaYin Electric | Eastern Communications vs. Guangdong Jingyi Metal |
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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