Correlation Between Guangzhou Haige and China Longyuan
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By analyzing existing cross correlation between Guangzhou Haige Communications and China Longyuan Power, you can compare the effects of market volatilities on Guangzhou Haige and China Longyuan 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 China Longyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and China Longyuan.
Diversification Opportunities for Guangzhou Haige and China Longyuan
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and China is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and China Longyuan Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Longyuan Power 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 China Longyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Longyuan Power has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and China Longyuan go up and down completely randomly.
Pair Corralation between Guangzhou Haige and China Longyuan
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to generate 1.12 times more return on investment than China Longyuan. However, Guangzhou Haige is 1.12 times more volatile than China Longyuan Power. It trades about 0.21 of its potential returns per unit of risk. China Longyuan Power is currently generating about 0.1 per unit of risk. If you would invest 868.00 in Guangzhou Haige Communications on September 4, 2024 and sell it today you would earn a total of 419.00 from holding Guangzhou Haige Communications or generate 48.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. China Longyuan Power
Performance |
| Timeline |
| Guangzhou Haige Comm |
| China Longyuan Power |
Guangzhou Haige and China Longyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and China Longyuan
The main advantage of trading using opposite Guangzhou Haige and China Longyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, China Longyuan 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 Longyuan will offset losses from the drop in China Longyuan's long position.| Guangzhou Haige vs. Industrial and Commercial | Guangzhou Haige vs. China Construction Bank | Guangzhou Haige vs. Bank of China | Guangzhou Haige vs. Agricultural Bank of |
| China Longyuan vs. Nanjing OLO Home | China Longyuan vs. Guangzhou Haige Communications | China Longyuan vs. Zhongtong Guomai Communication | China Longyuan vs. Shandong Homey Aquatic |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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