Correlation Between Guosheng Financial and Dow Jones
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By analyzing existing cross correlation between Guosheng Financial Holding and Dow Jones Industrial, you can compare the effects of market volatilities on Guosheng Financial and Dow Jones 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 Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guosheng Financial and Dow Jones.
Diversification Opportunities for Guosheng Financial and Dow Jones
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guosheng and Dow is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Guosheng Financial Holding and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial 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 Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Guosheng Financial i.e., Guosheng Financial and Dow Jones go up and down completely randomly.
Pair Corralation between Guosheng Financial and Dow Jones
Assuming the 90 days trading horizon Guosheng Financial Holding is expected to generate 4.3 times more return on investment than Dow Jones. However, Guosheng Financial is 4.3 times more volatile than Dow Jones Industrial. It trades about 0.03 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 824.00 in Guosheng Financial Holding on August 25, 2024 and sell it today you would earn a total of 276.00 from holding Guosheng Financial Holding or generate 33.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.18% |
| Values | Daily Returns |
Guosheng Financial Holding vs. Dow Jones Industrial
Performance |
| Timeline |
Guosheng Financial and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Guosheng Financial Holding
Pair trading matchups for Guosheng Financial
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Guosheng Financial and Dow Jones
The main advantage of trading using opposite Guosheng Financial and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guosheng Financial position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Guosheng Financial vs. BeiGene | Guosheng Financial vs. Kweichow Moutai Co | Guosheng Financial vs. Beijing Roborock Technology | Guosheng Financial vs. G bits Network Technology |
| Dow Jones vs. Vistra Energy Corp | Dow Jones vs. Fluence Energy | Dow Jones vs. Old Republic International | Dow Jones vs. Empresa Distribuidora y |
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 Stocks Directory module to find actively traded stocks across global markets.
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