Correlation Between Kuang Chi and Guangzhou Fangbang
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By analyzing existing cross correlation between Kuang Chi Technologies and Guangzhou Fangbang Electronics, you can compare the effects of market volatilities on Kuang Chi and Guangzhou Fangbang 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 Kuang Chi with a short position of Guangzhou Fangbang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and Guangzhou Fangbang.
Diversification Opportunities for Kuang Chi and Guangzhou Fangbang
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kuang and Guangzhou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and Guangzhou Fangbang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Fangbang and Kuang Chi 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 Kuang Chi Technologies are associated (or correlated) with Guangzhou Fangbang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Fangbang has no effect on the direction of Kuang Chi i.e., Kuang Chi and Guangzhou Fangbang go up and down completely randomly.
Pair Corralation between Kuang Chi and Guangzhou Fangbang
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to generate 0.91 times more return on investment than Guangzhou Fangbang. However, Kuang Chi Technologies is 1.1 times less risky than Guangzhou Fangbang. It trades about 0.22 of its potential returns per unit of risk. Guangzhou Fangbang Electronics is currently generating about 0.05 per unit of risk. If you would invest 1,721 in Kuang Chi Technologies on September 27, 2024 and sell it today you would earn a total of 2,694 from holding Kuang Chi Technologies or generate 156.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuang Chi Technologies vs. Guangzhou Fangbang Electronics
Performance |
| Timeline |
| Kuang Chi Technologies |
| Guangzhou Fangbang |
Kuang Chi and Guangzhou Fangbang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and Guangzhou Fangbang
The main advantage of trading using opposite Kuang Chi and Guangzhou Fangbang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, Guangzhou Fangbang 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 Fangbang will offset losses from the drop in Guangzhou Fangbang's long position.| Kuang Chi vs. China Life Insurance | Kuang Chi vs. Cinda Securities Co | Kuang Chi vs. Piotech Inc A | Kuang Chi vs. Dongxing Sec Co |
| Guangzhou Fangbang vs. Industrial and Commercial | Guangzhou Fangbang vs. China Construction Bank | Guangzhou Fangbang vs. Agricultural Bank of | Guangzhou Fangbang vs. Bank of China |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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