Correlation Between Guangdong Shenglu and Everdisplay Optronics
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By analyzing existing cross correlation between Guangdong Shenglu Telecommunication and Everdisplay Optronics Shanghai, you can compare the effects of market volatilities on Guangdong Shenglu and Everdisplay Optronics 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 Everdisplay Optronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Shenglu and Everdisplay Optronics.
Diversification Opportunities for Guangdong Shenglu and Everdisplay Optronics
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Everdisplay is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Shenglu Telecommunic and Everdisplay Optronics Shanghai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everdisplay Optronics 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 Everdisplay Optronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everdisplay Optronics has no effect on the direction of Guangdong Shenglu i.e., Guangdong Shenglu and Everdisplay Optronics go up and down completely randomly.
Pair Corralation between Guangdong Shenglu and Everdisplay Optronics
Assuming the 90 days trading horizon Guangdong Shenglu Telecommunication is expected to generate 1.4 times more return on investment than Everdisplay Optronics. However, Guangdong Shenglu is 1.4 times more volatile than Everdisplay Optronics Shanghai. It trades about 0.06 of its potential returns per unit of risk. Everdisplay Optronics Shanghai is currently generating about 0.08 per unit of risk. If you would invest 614.00 in Guangdong Shenglu Telecommunication on September 1, 2024 and sell it today you would earn a total of 112.00 from holding Guangdong Shenglu Telecommunication or generate 18.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Shenglu Telecommunic vs. Everdisplay Optronics Shanghai
Performance |
| Timeline |
| Guangdong Shenglu |
| Everdisplay Optronics |
Guangdong Shenglu and Everdisplay Optronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Shenglu and Everdisplay Optronics
The main advantage of trading using opposite Guangdong Shenglu and Everdisplay Optronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Shenglu position performs unexpectedly, Everdisplay Optronics 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 Everdisplay Optronics will offset losses from the drop in Everdisplay Optronics' long position.| Guangdong Shenglu vs. Guocheng Mining Co | Guangdong Shenglu vs. Beijing SPC Environment | Guangdong Shenglu vs. Uroica Mining Safety | Guangdong Shenglu vs. Tongxing Environmental Protection |
| Everdisplay Optronics vs. Cultural Investment Holdings | Everdisplay Optronics vs. Gome Telecom Equipment | Everdisplay Optronics vs. Bus Online Co | Everdisplay Optronics vs. Zotye Automobile Co |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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