Correlation Between Songz Automobile and Guangzhou Fangbang
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By analyzing existing cross correlation between Songz Automobile Air and Guangzhou Fangbang Electronics, you can compare the effects of market volatilities on Songz Automobile and Guangzhou Fangbang 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 Songz Automobile with a short position of Guangzhou Fangbang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songz Automobile and Guangzhou Fangbang.
Diversification Opportunities for Songz Automobile and Guangzhou Fangbang
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Songz and Guangzhou is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Songz Automobile Air and Guangzhou Fangbang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Fangbang and Songz Automobile 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 Songz Automobile Air are associated (or correlated) with Guangzhou Fangbang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Fangbang has no effect on the direction of Songz Automobile i.e., Songz Automobile and Guangzhou Fangbang go up and down completely randomly.
Pair Corralation between Songz Automobile and Guangzhou Fangbang
Assuming the 90 days trading horizon Songz Automobile Air is expected to generate 0.75 times more return on investment than Guangzhou Fangbang. However, Songz Automobile Air is 1.33 times less risky than Guangzhou Fangbang. It trades about -0.03 of its potential returns per unit of risk. Guangzhou Fangbang Electronics is currently generating about -0.19 per unit of risk. If you would invest 681.00 in Songz Automobile Air on October 30, 2024 and sell it today you would lose (12.00) from holding Songz Automobile Air or give up 1.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Songz Automobile Air vs. Guangzhou Fangbang Electronics
Performance |
| Timeline |
| Songz Automobile Air |
| Guangzhou Fangbang |
Songz Automobile and Guangzhou Fangbang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songz Automobile and Guangzhou Fangbang
The main advantage of trading using opposite Songz Automobile and Guangzhou Fangbang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songz Automobile position performs unexpectedly, Guangzhou Fangbang 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 Guangzhou Fangbang will offset losses from the drop in Guangzhou Fangbang's long position.| Songz Automobile vs. Kweichow Moutai Co | Songz Automobile vs. Jiangsu Pacific Quartz | Songz Automobile vs. Shenzhen Transsion Holdings | Songz Automobile vs. Beijing Roborock Technology |
| Guangzhou Fangbang vs. Gansu Huangtai Wine marketing | Guangzhou Fangbang vs. Lootom Telcovideo Network | Guangzhou Fangbang vs. Vats Liquor Chain | Guangzhou Fangbang vs. Xiamen Goldenhome 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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