Correlation Between Guangdong Qunxing and China Citic
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By analyzing existing cross correlation between Guangdong Qunxing Toys and China Citic Bank, you can compare the effects of market volatilities on Guangdong Qunxing and China Citic 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 Guangdong Qunxing with a short position of China Citic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Qunxing and China Citic.
Diversification Opportunities for Guangdong Qunxing and China Citic
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and China is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Qunxing Toys and China Citic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Citic Bank and Guangdong Qunxing 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 Guangdong Qunxing Toys are associated (or correlated) with China Citic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Citic Bank has no effect on the direction of Guangdong Qunxing i.e., Guangdong Qunxing and China Citic go up and down completely randomly.
Pair Corralation between Guangdong Qunxing and China Citic
Assuming the 90 days trading horizon Guangdong Qunxing Toys is expected to generate 2.83 times more return on investment than China Citic. However, Guangdong Qunxing is 2.83 times more volatile than China Citic Bank. It trades about 0.27 of its potential returns per unit of risk. China Citic Bank is currently generating about 0.16 per unit of risk. If you would invest 635.00 in Guangdong Qunxing Toys on September 14, 2024 and sell it today you would earn a total of 162.00 from holding Guangdong Qunxing Toys or generate 25.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Qunxing Toys vs. China Citic Bank
Performance |
| Timeline |
| Guangdong Qunxing Toys |
| China Citic Bank |
Guangdong Qunxing and China Citic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Qunxing and China Citic
The main advantage of trading using opposite Guangdong Qunxing and China Citic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Qunxing position performs unexpectedly, China Citic 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 Citic will offset losses from the drop in China Citic's long position.| Guangdong Qunxing vs. Ye Chiu Metal | Guangdong Qunxing vs. Zhejiang Yayi Metal | Guangdong Qunxing vs. Wuhan Yangtze Communication | Guangdong Qunxing vs. Shengda Mining Co |
| China Citic vs. Guangdong Qunxing Toys | China Citic vs. Haima Automobile Group | China Citic vs. Shandong Iron and | China Citic vs. Anhui Jianghuai Automobile |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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