Correlation Between BYD Co and Guangdong Xiongsu
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By analyzing existing cross correlation between BYD Co Ltd and Guangdong Xiongsu Technology, you can compare the effects of market volatilities on BYD Co and Guangdong Xiongsu 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 BYD Co with a short position of Guangdong Xiongsu. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and Guangdong Xiongsu.
Diversification Opportunities for BYD Co and Guangdong Xiongsu
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BYD and Guangdong is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and Guangdong Xiongsu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Xiongsu and BYD Co 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 BYD Co Ltd are associated (or correlated) with Guangdong Xiongsu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Xiongsu has no effect on the direction of BYD Co i.e., BYD Co and Guangdong Xiongsu go up and down completely randomly.
Pair Corralation between BYD Co and Guangdong Xiongsu
Assuming the 90 days trading horizon BYD Co is expected to generate 1.8 times less return on investment than Guangdong Xiongsu. But when comparing it to its historical volatility, BYD Co Ltd is 2.09 times less risky than Guangdong Xiongsu. It trades about 0.07 of its potential returns per unit of risk. Guangdong Xiongsu Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 513.00 in Guangdong Xiongsu Technology on September 27, 2024 and sell it today you would earn a total of 122.00 from holding Guangdong Xiongsu Technology or generate 23.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. Guangdong Xiongsu Technology
Performance |
| Timeline |
| BYD Co |
| Guangdong Xiongsu |
BYD Co and Guangdong Xiongsu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and Guangdong Xiongsu
The main advantage of trading using opposite BYD Co and Guangdong Xiongsu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, Guangdong Xiongsu 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 Guangdong Xiongsu will offset losses from the drop in Guangdong Xiongsu's long position.| BYD Co vs. Vanfund Urban Investment | BYD Co vs. Zhongrun Resources Investment | BYD Co vs. Tongyu Communication | BYD Co vs. Hubei Geoway Investment |
| Guangdong Xiongsu vs. Kweichow Moutai Co | Guangdong Xiongsu vs. Contemporary Amperex Technology | Guangdong Xiongsu vs. G bits Network Technology | Guangdong Xiongsu vs. BYD Co Ltd |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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