Correlation Between Guilin Seamild and Gan Yuan
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By analyzing existing cross correlation between Guilin Seamild Foods and Gan Yuan Foods, you can compare the effects of market volatilities on Guilin Seamild and Gan Yuan 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 Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guilin Seamild and Gan Yuan.
Diversification Opportunities for Guilin Seamild and Gan Yuan
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guilin and Gan is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Guilin Seamild Foods and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods 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 Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Guilin Seamild i.e., Guilin Seamild and Gan Yuan go up and down completely randomly.
Pair Corralation between Guilin Seamild and Gan Yuan
Assuming the 90 days trading horizon Guilin Seamild Foods is expected to generate 0.74 times more return on investment than Gan Yuan. However, Guilin Seamild Foods is 1.34 times less risky than Gan Yuan. It trades about -0.05 of its potential returns per unit of risk. Gan Yuan Foods is currently generating about -0.28 per unit of risk. If you would invest 1,640 in Guilin Seamild Foods on November 20, 2024 and sell it today you would lose (37.00) from holding Guilin Seamild Foods or give up 2.26% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 93.75% |
Values | Daily Returns |
Guilin Seamild Foods vs. Gan Yuan Foods
Performance |
Timeline |
Guilin Seamild Foods |
Gan Yuan Foods |
Guilin Seamild and Gan Yuan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guilin Seamild and Gan Yuan
The main advantage of trading using opposite Guilin Seamild and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guilin Seamild position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.Guilin Seamild vs. Rising Nonferrous Metals | ||
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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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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