Correlation Between Guangzhou Haige and Shenwu Energy
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By analyzing existing cross correlation between Guangzhou Haige Communications and Shenwu Energy Saving, you can compare the effects of market volatilities on Guangzhou Haige and Shenwu Energy 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 Haige with a short position of Shenwu Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Shenwu Energy.
Diversification Opportunities for Guangzhou Haige and Shenwu Energy
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and Shenwu is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Shenwu Energy Saving in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenwu Energy Saving and Guangzhou Haige 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 Haige Communications are associated (or correlated) with Shenwu Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenwu Energy Saving has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Shenwu Energy go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Shenwu Energy
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to under-perform the Shenwu Energy. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Haige Communications is 1.82 times less risky than Shenwu Energy. The stock trades about -0.13 of its potential returns per unit of risk. The Shenwu Energy Saving is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 399.00 in Shenwu Energy Saving on October 16, 2024 and sell it today you would earn a total of 12.00 from holding Shenwu Energy Saving or generate 3.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. Shenwu Energy Saving
Performance |
| Timeline |
| Guangzhou Haige Comm |
| Shenwu Energy Saving |
Guangzhou Haige and Shenwu Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and Shenwu Energy
The main advantage of trading using opposite Guangzhou Haige and Shenwu Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Shenwu Energy 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 Shenwu Energy will offset losses from the drop in Shenwu Energy's long position.| Guangzhou Haige vs. Shuhua Sports Co | Guangzhou Haige vs. Heilongjiang Transport Development | Guangzhou Haige vs. Eastern Communications Co | Guangzhou Haige vs. Sichuan Fulin Transportation |
| Shenwu Energy vs. Guangdong Shenglu Telecommunication | Shenwu Energy vs. Guangzhou Haige Communications | Shenwu Energy vs. Xiangyang Automobile Bearing | Shenwu Energy vs. Queclink Wireless Solutions |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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