Correlation Between Guosheng Financial and Autek China
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By analyzing existing cross correlation between Guosheng Financial Holding and Autek China, you can compare the effects of market volatilities on Guosheng Financial and Autek China 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 Autek China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guosheng Financial and Autek China.
Diversification Opportunities for Guosheng Financial and Autek China
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guosheng and Autek is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Guosheng Financial Holding and Autek China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autek China 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 Autek China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autek China has no effect on the direction of Guosheng Financial i.e., Guosheng Financial and Autek China go up and down completely randomly.
Pair Corralation between Guosheng Financial and Autek China
Assuming the 90 days trading horizon Guosheng Financial Holding is expected to generate 1.93 times more return on investment than Autek China. However, Guosheng Financial is 1.93 times more volatile than Autek China. It trades about 0.37 of its potential returns per unit of risk. Autek China is currently generating about -0.09 per unit of risk. If you would invest 1,202 in Guosheng Financial Holding on September 13, 2024 and sell it today you would earn a total of 538.00 from holding Guosheng Financial Holding or generate 44.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guosheng Financial Holding vs. Autek China
Performance |
| Timeline |
| Guosheng Financial |
| Autek China |
Guosheng Financial and Autek China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guosheng Financial and Autek China
The main advantage of trading using opposite Guosheng Financial and Autek China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guosheng Financial position performs unexpectedly, Autek China 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 Autek China will offset losses from the drop in Autek China's long position.| Guosheng Financial vs. Leyard Optoelectronic | Guosheng Financial vs. Juneyao Airlines | Guosheng Financial vs. Xinya Electronic Co | Guosheng Financial vs. Epoxy Base Electronic |
| Autek China vs. Zhongrun Resources Investment | Autek China vs. North Huajin Chemical | Autek China vs. Miracll Chemicals Co | Autek China vs. Nuode Investment Co |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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