Correlation Between Guizhou Chanhen and Wuxi Chemical
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By analyzing existing cross correlation between Guizhou Chanhen Chemical and Wuxi Chemical Equipment, you can compare the effects of market volatilities on Guizhou Chanhen and Wuxi Chemical 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 Guizhou Chanhen with a short position of Wuxi Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guizhou Chanhen and Wuxi Chemical.
Diversification Opportunities for Guizhou Chanhen and Wuxi Chemical
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guizhou and Wuxi is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Guizhou Chanhen Chemical and Wuxi Chemical Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuxi Chemical Equipment and Guizhou Chanhen 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 Guizhou Chanhen Chemical are associated (or correlated) with Wuxi Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuxi Chemical Equipment has no effect on the direction of Guizhou Chanhen i.e., Guizhou Chanhen and Wuxi Chemical go up and down completely randomly.
Pair Corralation between Guizhou Chanhen and Wuxi Chemical
Assuming the 90 days trading horizon Guizhou Chanhen Chemical is expected to generate 1.18 times more return on investment than Wuxi Chemical. However, Guizhou Chanhen is 1.18 times more volatile than Wuxi Chemical Equipment. It trades about -0.11 of its potential returns per unit of risk. Wuxi Chemical Equipment is currently generating about -0.18 per unit of risk. If you would invest 2,250 in Guizhou Chanhen Chemical on October 14, 2024 and sell it today you would lose (132.00) from holding Guizhou Chanhen Chemical or give up 5.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guizhou Chanhen Chemical vs. Wuxi Chemical Equipment
Performance |
| Timeline |
| Guizhou Chanhen Chemical |
| Wuxi Chemical Equipment |
Guizhou Chanhen and Wuxi Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guizhou Chanhen and Wuxi Chemical
The main advantage of trading using opposite Guizhou Chanhen and Wuxi Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guizhou Chanhen position performs unexpectedly, Wuxi Chemical 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 Wuxi Chemical will offset losses from the drop in Wuxi Chemical's long position.| Guizhou Chanhen vs. Xiamen Goldenhome Co | Guizhou Chanhen vs. China Sports Industry | Guizhou Chanhen vs. Shanghai Shuixing Home | Guizhou Chanhen vs. Oppein Home Group |
| Wuxi Chemical vs. Guangdong Silvere Sci | Wuxi Chemical vs. Uroica Mining Safety | Wuxi Chemical vs. Zhejiang JIULI Hi tech | Wuxi Chemical vs. Xinjiang Baodi Mining |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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