Correlation Between Dongguan Chitwing and Guangdong Xiongsu
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By analyzing existing cross correlation between Dongguan Chitwing Technology and Guangdong Xiongsu Technology, you can compare the effects of market volatilities on Dongguan Chitwing and Guangdong Xiongsu 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 Dongguan Chitwing with a short position of Guangdong Xiongsu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongguan Chitwing and Guangdong Xiongsu.
Diversification Opportunities for Dongguan Chitwing and Guangdong Xiongsu
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dongguan and Guangdong is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Dongguan Chitwing Technology and Guangdong Xiongsu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Xiongsu and Dongguan Chitwing 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 Dongguan Chitwing Technology are associated (or correlated) with Guangdong Xiongsu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Xiongsu has no effect on the direction of Dongguan Chitwing i.e., Dongguan Chitwing and Guangdong Xiongsu go up and down completely randomly.
Pair Corralation between Dongguan Chitwing and Guangdong Xiongsu
Assuming the 90 days trading horizon Dongguan Chitwing Technology is expected to under-perform the Guangdong Xiongsu. In addition to that, Dongguan Chitwing is 1.53 times more volatile than Guangdong Xiongsu Technology. It trades about -0.05 of its total potential returns per unit of risk. Guangdong Xiongsu Technology is currently generating about -0.02 per unit of volatility. If you would invest 793.00 in Guangdong Xiongsu Technology on September 1, 2024 and sell it today you would lose (19.00) from holding Guangdong Xiongsu Technology or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongguan Chitwing Technology vs. Guangdong Xiongsu Technology
Performance |
| Timeline |
| Dongguan Chitwing |
| Guangdong Xiongsu |
Dongguan Chitwing and Guangdong Xiongsu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongguan Chitwing and Guangdong Xiongsu
The main advantage of trading using opposite Dongguan Chitwing and Guangdong Xiongsu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongguan Chitwing position performs unexpectedly, Guangdong Xiongsu 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 Guangdong Xiongsu will offset losses from the drop in Guangdong Xiongsu's long position.| Dongguan Chitwing vs. China Petroleum Chemical | Dongguan Chitwing vs. PetroChina Co Ltd | Dongguan Chitwing vs. China State Construction | Dongguan Chitwing vs. China Railway Group |
| Guangdong Xiongsu vs. Industrial and Commercial | Guangdong Xiongsu vs. Agricultural Bank of | Guangdong Xiongsu vs. China Construction Bank | Guangdong Xiongsu vs. Bank of China |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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