Correlation Between Guangzhou Zhujiang and China Express
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By analyzing existing cross correlation between Guangzhou Zhujiang Brewery and China Express Airlines, you can compare the effects of market volatilities on Guangzhou Zhujiang and China Express 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 Guangzhou Zhujiang with a short position of China Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Zhujiang and China Express.
Diversification Opportunities for Guangzhou Zhujiang and China Express
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and China is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Zhujiang Brewery and China Express Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Express Airlines and Guangzhou Zhujiang 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 Guangzhou Zhujiang Brewery are associated (or correlated) with China Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Express Airlines has no effect on the direction of Guangzhou Zhujiang i.e., Guangzhou Zhujiang and China Express go up and down completely randomly.
Pair Corralation between Guangzhou Zhujiang and China Express
Assuming the 90 days trading horizon Guangzhou Zhujiang Brewery is expected to generate 0.64 times more return on investment than China Express. However, Guangzhou Zhujiang Brewery is 1.56 times less risky than China Express. It trades about -0.01 of its potential returns per unit of risk. China Express Airlines is currently generating about -0.17 per unit of risk. If you would invest 910.00 in Guangzhou Zhujiang Brewery on September 12, 2024 and sell it today you would lose (4.00) from holding Guangzhou Zhujiang Brewery or give up 0.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Zhujiang Brewery vs. China Express Airlines
Performance |
| Timeline |
| Guangzhou Zhujiang |
| China Express Airlines |
Guangzhou Zhujiang and China Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Zhujiang and China Express
The main advantage of trading using opposite Guangzhou Zhujiang and China Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Zhujiang position performs unexpectedly, China Express 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 China Express will offset losses from the drop in China Express' long position.| Guangzhou Zhujiang vs. China Petroleum Chemical | Guangzhou Zhujiang vs. PetroChina Co Ltd | Guangzhou Zhujiang vs. China State Construction | Guangzhou Zhujiang vs. China Railway Group |
| China Express vs. Agricultural Bank of | China Express vs. Industrial and Commercial | China Express vs. Bank of China | China Express 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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