Correlation Between Guangdong Shenglu and TianJin 712
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By analyzing existing cross correlation between Guangdong Shenglu Telecommunication and TianJin 712 Communication, you can compare the effects of market volatilities on Guangdong Shenglu and TianJin 712 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 TianJin 712. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Shenglu and TianJin 712.
Diversification Opportunities for Guangdong Shenglu and TianJin 712
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangdong and TianJin is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Shenglu Telecommunic and TianJin 712 Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TianJin 712 Communication 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 TianJin 712. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TianJin 712 Communication has no effect on the direction of Guangdong Shenglu i.e., Guangdong Shenglu and TianJin 712 go up and down completely randomly.
Pair Corralation between Guangdong Shenglu and TianJin 712
Assuming the 90 days trading horizon Guangdong Shenglu Telecommunication is expected to generate 1.12 times more return on investment than TianJin 712. However, Guangdong Shenglu is 1.12 times more volatile than TianJin 712 Communication. It trades about 0.0 of its potential returns per unit of risk. TianJin 712 Communication is currently generating about -0.02 per unit of risk. If you would invest 968.00 in Guangdong Shenglu Telecommunication on September 14, 2024 and sell it today you would lose (198.00) from holding Guangdong Shenglu Telecommunication or give up 20.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Shenglu Telecommunic vs. TianJin 712 Communication
Performance |
| Timeline |
| Guangdong Shenglu |
| TianJin 712 Communication |
Guangdong Shenglu and TianJin 712 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Shenglu and TianJin 712
The main advantage of trading using opposite Guangdong Shenglu and TianJin 712 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Shenglu position performs unexpectedly, TianJin 712 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 TianJin 712 will offset losses from the drop in TianJin 712's long position.| Guangdong Shenglu vs. China Railway Materials | Guangdong Shenglu vs. Xinke Material | Guangdong Shenglu vs. Orinko Advanced Plastics | Guangdong Shenglu vs. Chongqing Sulian Plastic |
| TianJin 712 vs. Guangzhou Haige Communications | TianJin 712 vs. Zhongtong Guomai Communication | TianJin 712 vs. Zhengzhou Coal Mining | TianJin 712 vs. Changchun Faway Automobile |
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 Stocks Directory module to find actively traded stocks across global markets.
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