Correlation Between Fujian Rongji and Guangzhou Haige
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By analyzing existing cross correlation between Fujian Rongji Software and Guangzhou Haige Communications, you can compare the effects of market volatilities on Fujian Rongji and Guangzhou Haige 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 Fujian Rongji with a short position of Guangzhou Haige. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Rongji and Guangzhou Haige.
Diversification Opportunities for Fujian Rongji and Guangzhou Haige
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Guangzhou is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Rongji Software and Guangzhou Haige Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Haige Comm and Fujian Rongji 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 Fujian Rongji Software are associated (or correlated) with Guangzhou Haige. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Haige Comm has no effect on the direction of Fujian Rongji i.e., Fujian Rongji and Guangzhou Haige go up and down completely randomly.
Pair Corralation between Fujian Rongji and Guangzhou Haige
Assuming the 90 days trading horizon Fujian Rongji Software is expected to generate 1.31 times more return on investment than Guangzhou Haige. However, Fujian Rongji is 1.31 times more volatile than Guangzhou Haige Communications. It trades about 0.15 of its potential returns per unit of risk. Guangzhou Haige Communications is currently generating about 0.16 per unit of risk. If you would invest 609.00 in Fujian Rongji Software on September 4, 2024 and sell it today you would earn a total of 85.00 from holding Fujian Rongji Software or generate 13.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Rongji Software vs. Guangzhou Haige Communications
Performance |
| Timeline |
| Fujian Rongji Software |
| Guangzhou Haige Comm |
Fujian Rongji and Guangzhou Haige Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Rongji and Guangzhou Haige
The main advantage of trading using opposite Fujian Rongji and Guangzhou Haige positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Rongji position performs unexpectedly, Guangzhou Haige 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 Guangzhou Haige will offset losses from the drop in Guangzhou Haige's long position.| Fujian Rongji vs. New China Life | Fujian Rongji vs. Ming Yang Smart | Fujian Rongji vs. 159681 | Fujian Rongji vs. 159005 |
| Guangzhou Haige vs. Industrial and Commercial | Guangzhou Haige vs. China Construction Bank | Guangzhou Haige vs. Bank of China | Guangzhou Haige vs. Agricultural Bank of |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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