Correlation Between Guangzhou Jointas and Shaanxi Beiyuan
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By analyzing existing cross correlation between Guangzhou Jointas Chemical and Shaanxi Beiyuan Chemical, you can compare the effects of market volatilities on Guangzhou Jointas and Shaanxi Beiyuan 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 Jointas with a short position of Shaanxi Beiyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Jointas and Shaanxi Beiyuan.
Diversification Opportunities for Guangzhou Jointas and Shaanxi Beiyuan
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangzhou and Shaanxi is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Jointas Chemical and Shaanxi Beiyuan Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Beiyuan Chemical and Guangzhou Jointas 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 Jointas Chemical are associated (or correlated) with Shaanxi Beiyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Beiyuan Chemical has no effect on the direction of Guangzhou Jointas i.e., Guangzhou Jointas and Shaanxi Beiyuan go up and down completely randomly.
Pair Corralation between Guangzhou Jointas and Shaanxi Beiyuan
Assuming the 90 days trading horizon Guangzhou Jointas Chemical is expected to under-perform the Shaanxi Beiyuan. In addition to that, Guangzhou Jointas is 1.85 times more volatile than Shaanxi Beiyuan Chemical. It trades about -0.02 of its total potential returns per unit of risk. Shaanxi Beiyuan Chemical is currently generating about -0.02 per unit of volatility. If you would invest 464.00 in Shaanxi Beiyuan Chemical on December 12, 2024 and sell it today you would lose (54.00) from holding Shaanxi Beiyuan Chemical or give up 11.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Jointas Chemical vs. Shaanxi Beiyuan Chemical
Performance |
| Timeline |
| Guangzhou Jointas |
| Shaanxi Beiyuan Chemical |
Guangzhou Jointas and Shaanxi Beiyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Jointas and Shaanxi Beiyuan
The main advantage of trading using opposite Guangzhou Jointas and Shaanxi Beiyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Jointas position performs unexpectedly, Shaanxi Beiyuan 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 Shaanxi Beiyuan will offset losses from the drop in Shaanxi Beiyuan's long position.| Guangzhou Jointas vs. Chengdu Xinzhu RoadBridge | ||
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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