Correlation Between Guosheng Financial and Northern United
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By analyzing existing cross correlation between Guosheng Financial Holding and Northern United Publishing, you can compare the effects of market volatilities on Guosheng Financial and Northern United 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 Northern United. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guosheng Financial and Northern United.
Diversification Opportunities for Guosheng Financial and Northern United
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guosheng and Northern is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Guosheng Financial Holding and Northern United Publishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern United Publ 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 Northern United. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern United Publ has no effect on the direction of Guosheng Financial i.e., Guosheng Financial and Northern United go up and down completely randomly.
Pair Corralation between Guosheng Financial and Northern United
Assuming the 90 days trading horizon Guosheng Financial Holding is expected to generate 1.05 times more return on investment than Northern United. However, Guosheng Financial is 1.05 times more volatile than Northern United Publishing. It trades about 0.04 of its potential returns per unit of risk. Northern United Publishing is currently generating about 0.01 per unit of risk. If you would invest 937.00 in Guosheng Financial Holding on October 16, 2024 and sell it today you would earn a total of 376.00 from holding Guosheng Financial Holding or generate 40.13% 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. Northern United Publishing
Performance |
Timeline |
Guosheng Financial |
Northern United Publ |
Guosheng Financial and Northern United Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guosheng Financial and Northern United
The main advantage of trading using opposite Guosheng Financial and Northern United positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guosheng Financial position performs unexpectedly, Northern United 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 Northern United will offset losses from the drop in Northern United's long position.Guosheng Financial vs. Nanxing Furniture Machinery | Guosheng Financial vs. Beijing Kingsoft Office | Guosheng Financial vs. Shandong Longquan Pipeline | Guosheng Financial vs. Ziel Home Furnishing |
Northern United vs. Wintao Communications Co | Northern United vs. Guosheng Financial Holding | Northern United vs. Allwin Telecommunication Co | Northern United vs. Beijing Bewinner Communications |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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