Correlation Between Guangzhou Jointas and Chahua Modern
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By analyzing existing cross correlation between Guangzhou Jointas Chemical and Chahua Modern Housewares, you can compare the effects of market volatilities on Guangzhou Jointas and Chahua Modern 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 Chahua Modern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Jointas and Chahua Modern.
Diversification Opportunities for Guangzhou Jointas and Chahua Modern
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Chahua is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Jointas Chemical and Chahua Modern Housewares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chahua Modern Housewares 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 Chahua Modern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chahua Modern Housewares has no effect on the direction of Guangzhou Jointas i.e., Guangzhou Jointas and Chahua Modern go up and down completely randomly.
Pair Corralation between Guangzhou Jointas and Chahua Modern
Assuming the 90 days trading horizon Guangzhou Jointas Chemical is expected to under-perform the Chahua Modern. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Jointas Chemical is 1.43 times less risky than Chahua Modern. The stock trades about -0.02 of its potential returns per unit of risk. The Chahua Modern Housewares is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 857.00 in Chahua Modern Housewares on August 31, 2024 and sell it today you would earn a total of 1,330 from holding Chahua Modern Housewares or generate 155.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Jointas Chemical vs. Chahua Modern Housewares
Performance |
| Timeline |
| Guangzhou Jointas |
| Chahua Modern Housewares |
Guangzhou Jointas and Chahua Modern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Jointas and Chahua Modern
The main advantage of trading using opposite Guangzhou Jointas and Chahua Modern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Jointas position performs unexpectedly, Chahua Modern 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 Chahua Modern will offset losses from the drop in Chahua Modern's long position.| Guangzhou Jointas vs. Jiangxi Naipu Mining | Guangzhou Jointas vs. Chenzhou Jingui Silver | Guangzhou Jointas vs. JCHX Mining Management | Guangzhou Jointas vs. Sinofibers Technology Co |
| Chahua Modern vs. China State Construction | Chahua Modern vs. China Merchants Shekou | Chahua Modern vs. Huafa Industrial Co | Chahua Modern vs. China International Capital |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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