Correlation Between Guilin Seamild and Shandong Longquan
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By analyzing existing cross correlation between Guilin Seamild Foods and Shandong Longquan Pipeline, you can compare the effects of market volatilities on Guilin Seamild and Shandong Longquan 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 Guilin Seamild with a short position of Shandong Longquan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guilin Seamild and Shandong Longquan.
Diversification Opportunities for Guilin Seamild and Shandong Longquan
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Guilin and Shandong is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Guilin Seamild Foods and Shandong Longquan Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Longquan and Guilin Seamild 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 Guilin Seamild Foods are associated (or correlated) with Shandong Longquan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Longquan has no effect on the direction of Guilin Seamild i.e., Guilin Seamild and Shandong Longquan go up and down completely randomly.
Pair Corralation between Guilin Seamild and Shandong Longquan
Assuming the 90 days trading horizon Guilin Seamild Foods is expected to generate 1.6 times more return on investment than Shandong Longquan. However, Guilin Seamild is 1.6 times more volatile than Shandong Longquan Pipeline. It trades about 0.11 of its potential returns per unit of risk. Shandong Longquan Pipeline is currently generating about 0.05 per unit of risk. If you would invest 1,399 in Guilin Seamild Foods on October 26, 2024 and sell it today you would earn a total of 192.00 from holding Guilin Seamild Foods or generate 13.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guilin Seamild Foods vs. Shandong Longquan Pipeline
Performance |
| Timeline |
| Guilin Seamild Foods |
| Shandong Longquan |
Guilin Seamild and Shandong Longquan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guilin Seamild and Shandong Longquan
The main advantage of trading using opposite Guilin Seamild and Shandong Longquan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guilin Seamild position performs unexpectedly, Shandong Longquan 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 Shandong Longquan will offset losses from the drop in Shandong Longquan's long position.| Guilin Seamild vs. Kweichow Moutai Co | Guilin Seamild vs. Contemporary Amperex Technology | Guilin Seamild vs. G bits Network Technology | Guilin Seamild vs. Beijing Roborock Technology |
| Shandong Longquan vs. Zijin Mining Group | Shandong Longquan vs. Wanhua Chemical Group | Shandong Longquan vs. Baoshan Iron Steel | Shandong Longquan vs. Shandong Gold 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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