Correlation Between Guosheng Financial and Shanghai Phichem
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By analyzing existing cross correlation between Guosheng Financial Holding and Shanghai Phichem Material, you can compare the effects of market volatilities on Guosheng Financial and Shanghai Phichem 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 Guosheng Financial with a short position of Shanghai Phichem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guosheng Financial and Shanghai Phichem.
Diversification Opportunities for Guosheng Financial and Shanghai Phichem
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Guosheng and Shanghai is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Guosheng Financial Holding and Shanghai Phichem Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Phichem Material and Guosheng Financial 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 Guosheng Financial Holding are associated (or correlated) with Shanghai Phichem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Phichem Material has no effect on the direction of Guosheng Financial i.e., Guosheng Financial and Shanghai Phichem go up and down completely randomly.
Pair Corralation between Guosheng Financial and Shanghai Phichem
Assuming the 90 days trading horizon Guosheng Financial is expected to generate 1.04 times less return on investment than Shanghai Phichem. In addition to that, Guosheng Financial is 2.04 times more volatile than Shanghai Phichem Material. It trades about 0.13 of its total potential returns per unit of risk. Shanghai Phichem Material is currently generating about 0.27 per unit of volatility. If you would invest 1,465 in Shanghai Phichem Material on November 4, 2024 and sell it today you would earn a total of 120.00 from holding Shanghai Phichem Material or generate 8.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guosheng Financial Holding vs. Shanghai Phichem Material
Performance |
| Timeline |
| Guosheng Financial |
| Shanghai Phichem Material |
Guosheng Financial and Shanghai Phichem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guosheng Financial and Shanghai Phichem
The main advantage of trading using opposite Guosheng Financial and Shanghai Phichem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guosheng Financial position performs unexpectedly, Shanghai Phichem 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 Shanghai Phichem will offset losses from the drop in Shanghai Phichem's long position.| Guosheng Financial vs. Gifore Agricultural Machinery | Guosheng Financial vs. Guangzhou KDT Machinery | Guosheng Financial vs. Qijing Machinery | Guosheng Financial vs. Sharetronic Data Technology |
| Shanghai Phichem vs. Tonghua Grape Wine | Shanghai Phichem vs. Eastroc Beverage Group | Shanghai Phichem vs. Jiangsu Xinri E Vehicle | Shanghai Phichem vs. Guangzhou Automobile Group |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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