Correlation Between Guangzhou Haige and Nanjing Putian
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By analyzing existing cross correlation between Guangzhou Haige Communications and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Guangzhou Haige and Nanjing Putian 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 Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Nanjing Putian.
Diversification Opportunities for Guangzhou Haige and Nanjing Putian
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangzhou and Nanjing is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec 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 Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Nanjing Putian go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Nanjing Putian
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to under-perform the Nanjing Putian. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Haige Communications is 2.15 times less risky than Nanjing Putian. The stock trades about -0.33 of its potential returns per unit of risk. The Nanjing Putian Telecommunications is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 403.00 in Nanjing Putian Telecommunications on October 20, 2024 and sell it today you would lose (12.00) from holding Nanjing Putian Telecommunications or give up 2.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Guangzhou Haige Comm |
| Nanjing Putian Telec |
Guangzhou Haige and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and Nanjing Putian
The main advantage of trading using opposite Guangzhou Haige and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Guangzhou Haige vs. Allied Machinery Co | Guangzhou Haige vs. Haima Automobile Group | Guangzhou Haige vs. Quectel Wireless Solutions | Guangzhou Haige vs. Shenzhen Zhongzhuang Construction |
| Nanjing Putian vs. Kangping Technology Co | Nanjing Putian vs. XiaMen HongXin Electron tech | Nanjing Putian vs. Guangzhou Haige Communications | Nanjing Putian vs. Holitech Technology 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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