Correlation Between Guangzhou Tinci and Guangzhou Ruoyuchen
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By analyzing existing cross correlation between Guangzhou Tinci Materials and Guangzhou Ruoyuchen Information, you can compare the effects of market volatilities on Guangzhou Tinci and Guangzhou Ruoyuchen 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 Guangzhou Tinci with a short position of Guangzhou Ruoyuchen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Tinci and Guangzhou Ruoyuchen.
Diversification Opportunities for Guangzhou Tinci and Guangzhou Ruoyuchen
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangzhou and Guangzhou is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Tinci Materials and Guangzhou Ruoyuchen Informatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Ruoyuchen and Guangzhou Tinci 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 Guangzhou Tinci Materials are associated (or correlated) with Guangzhou Ruoyuchen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Ruoyuchen has no effect on the direction of Guangzhou Tinci i.e., Guangzhou Tinci and Guangzhou Ruoyuchen go up and down completely randomly.
Pair Corralation between Guangzhou Tinci and Guangzhou Ruoyuchen
Assuming the 90 days trading horizon Guangzhou Tinci Materials is expected to generate 0.47 times more return on investment than Guangzhou Ruoyuchen. However, Guangzhou Tinci Materials is 2.11 times less risky than Guangzhou Ruoyuchen. It trades about -0.25 of its potential returns per unit of risk. Guangzhou Ruoyuchen Information is currently generating about -0.12 per unit of risk. If you would invest 2,037 in Guangzhou Tinci Materials on October 30, 2024 and sell it today you would lose (209.00) from holding Guangzhou Tinci Materials or give up 10.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Tinci Materials vs. Guangzhou Ruoyuchen Informatio
Performance |
| Timeline |
| Guangzhou Tinci Materials |
| Guangzhou Ruoyuchen |
Guangzhou Tinci and Guangzhou Ruoyuchen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Tinci and Guangzhou Ruoyuchen
The main advantage of trading using opposite Guangzhou Tinci and Guangzhou Ruoyuchen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Tinci position performs unexpectedly, Guangzhou Ruoyuchen 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 Ruoyuchen will offset losses from the drop in Guangzhou Ruoyuchen's long position.| Guangzhou Tinci vs. Zijin Mining Group | Guangzhou Tinci vs. Wanhua Chemical Group | Guangzhou Tinci vs. Baoshan Iron Steel | Guangzhou Tinci vs. Shandong Gold Mining |
| Guangzhou Ruoyuchen vs. China Petroleum Chemical | Guangzhou Ruoyuchen vs. PetroChina Co Ltd | Guangzhou Ruoyuchen vs. China State Construction | Guangzhou Ruoyuchen vs. China Railway 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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