Correlation Between Guangdong Shenglu and Haima Automobile
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By analyzing existing cross correlation between Guangdong Shenglu Telecommunication and Haima Automobile Group, you can compare the effects of market volatilities on Guangdong Shenglu and Haima Automobile 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 Shenglu with a short position of Haima Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Shenglu and Haima Automobile.
Diversification Opportunities for Guangdong Shenglu and Haima Automobile
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangdong and Haima is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Shenglu Telecommunic and Haima Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haima Automobile and Guangdong Shenglu 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 Shenglu Telecommunication are associated (or correlated) with Haima Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haima Automobile has no effect on the direction of Guangdong Shenglu i.e., Guangdong Shenglu and Haima Automobile go up and down completely randomly.
Pair Corralation between Guangdong Shenglu and Haima Automobile
Assuming the 90 days trading horizon Guangdong Shenglu Telecommunication is expected to under-perform the Haima Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Guangdong Shenglu Telecommunication is 1.99 times less risky than Haima Automobile. The stock trades about -0.01 of its potential returns per unit of risk. The Haima Automobile Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 399.00 in Haima Automobile Group on August 29, 2024 and sell it today you would earn a total of 44.00 from holding Haima Automobile Group or generate 11.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Shenglu Telecommunic vs. Haima Automobile Group
Performance |
| Timeline |
| Guangdong Shenglu |
| Haima Automobile |
Guangdong Shenglu and Haima Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Shenglu and Haima Automobile
The main advantage of trading using opposite Guangdong Shenglu and Haima Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Shenglu position performs unexpectedly, Haima Automobile 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 Haima Automobile will offset losses from the drop in Haima Automobile's long position.| Guangdong Shenglu vs. Shenzhen MYS Environmental | Guangdong Shenglu vs. AVIC Fund Management | Guangdong Shenglu vs. Shenzhen Bingchuan Network | Guangdong Shenglu vs. Penghua Shenzhen Energy |
| Haima Automobile vs. Lutian Machinery Co | Haima Automobile vs. China Longyuan Power | Haima Automobile vs. Changshu Tongrun Auto | Haima Automobile vs. PetroChina Co Ltd |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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