Correlation Between Guangzhou Haige and Jinhui Liquor
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By analyzing existing cross correlation between Guangzhou Haige Communications and Jinhui Liquor Co, you can compare the effects of market volatilities on Guangzhou Haige and Jinhui Liquor 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 Jinhui Liquor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Jinhui Liquor.
Diversification Opportunities for Guangzhou Haige and Jinhui Liquor
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Jinhui is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Jinhui Liquor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinhui Liquor 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 Jinhui Liquor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinhui Liquor has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Jinhui Liquor go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Jinhui Liquor
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to generate 1.14 times more return on investment than Jinhui Liquor. However, Guangzhou Haige is 1.14 times more volatile than Jinhui Liquor Co. It trades about 0.08 of its potential returns per unit of risk. Jinhui Liquor Co is currently generating about -0.08 per unit of risk. If you would invest 1,123 in Guangzhou Haige Communications on August 29, 2024 and sell it today you would earn a total of 58.00 from holding Guangzhou Haige Communications or generate 5.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haige Communications vs. Jinhui Liquor Co
Performance |
| Timeline |
| Guangzhou Haige Comm |
| Jinhui Liquor |
Guangzhou Haige and Jinhui Liquor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haige and Jinhui Liquor
The main advantage of trading using opposite Guangzhou Haige and Jinhui Liquor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Jinhui Liquor 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 Jinhui Liquor will offset losses from the drop in Jinhui Liquor's long position.| Guangzhou Haige vs. China State Construction | Guangzhou Haige vs. Huafa Industrial Co | Guangzhou Haige vs. China International Capital | Guangzhou Haige vs. Kweichow Moutai Co |
| Jinhui Liquor vs. PetroChina Co Ltd | Jinhui Liquor vs. China Mobile Limited | Jinhui Liquor vs. Ping An Insurance | Jinhui Liquor vs. China Petroleum Chemical |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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