Correlation Between Xiamen Jihong and Guangzhou Restaurants
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By analyzing existing cross correlation between Xiamen Jihong Package and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Xiamen Jihong and Guangzhou Restaurants 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 Xiamen Jihong with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Jihong and Guangzhou Restaurants.
Diversification Opportunities for Xiamen Jihong and Guangzhou Restaurants
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xiamen and Guangzhou is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Jihong Package and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Xiamen Jihong 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 Xiamen Jihong Package are associated (or correlated) with Guangzhou Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Restaurants has no effect on the direction of Xiamen Jihong i.e., Xiamen Jihong and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Xiamen Jihong and Guangzhou Restaurants
Assuming the 90 days trading horizon Xiamen Jihong Package is expected to generate 2.06 times more return on investment than Guangzhou Restaurants. However, Xiamen Jihong is 2.06 times more volatile than Guangzhou Restaurants Group. It trades about 0.33 of its potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about 0.02 per unit of risk. If you would invest 1,227 in Xiamen Jihong Package on August 31, 2024 and sell it today you would earn a total of 348.00 from holding Xiamen Jihong Package or generate 28.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Jihong Package vs. Guangzhou Restaurants Group
Performance |
| Timeline |
| Xiamen Jihong Package |
| Guangzhou Restaurants |
Xiamen Jihong and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Jihong and Guangzhou Restaurants
The main advantage of trading using opposite Xiamen Jihong and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Jihong position performs unexpectedly, Guangzhou Restaurants 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 Restaurants will offset losses from the drop in Guangzhou Restaurants' long position.| Xiamen Jihong vs. Hengkang Medical Group | Xiamen Jihong vs. Marssenger Kitchenware Co | Xiamen Jihong vs. Lander Sports Development | Xiamen Jihong vs. Sportsoul Co Ltd |
| Guangzhou Restaurants vs. Chinese Universe Publishing | Guangzhou Restaurants vs. Qingdao Foods Co | Guangzhou Restaurants vs. HaiXin Foods Co | Guangzhou Restaurants vs. Xiamen Jihong Package |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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