Correlation Between Guangzhou Haige and Linewell Software
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By analyzing existing cross correlation between Guangzhou Haige Communications and Linewell Software Co, you can compare the effects of market volatilities on Guangzhou Haige and Linewell Software 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 Linewell Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Linewell Software.
Diversification Opportunities for Guangzhou Haige and Linewell Software
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Linewell is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Linewell Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Linewell Software 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 Linewell Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Linewell Software has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Linewell Software go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Linewell Software
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to under-perform the Linewell Software. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Haige Communications is 1.05 times less risky than Linewell Software. The stock trades about -0.46 of its potential returns per unit of risk. The Linewell Software Co is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest 1,148 in Linewell Software Co on October 15, 2024 and sell it today you would lose (121.00) from holding Linewell Software Co or give up 10.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. Linewell Software Co
Performance |
| Timeline |
| Guangzhou Haige Comm |
| Linewell Software |
Guangzhou Haige and Linewell Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and Linewell Software
The main advantage of trading using opposite Guangzhou Haige and Linewell Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Linewell Software 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 Linewell Software will offset losses from the drop in Linewell Software's long position.| Guangzhou Haige vs. Uroica Mining Safety | Guangzhou Haige vs. ButOne Information Corp | Guangzhou Haige vs. Zhengzhou Coal Mining | Guangzhou Haige vs. Longmaster Information Tech |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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