Correlation Between Gan Yuan and China Merchants
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By analyzing existing cross correlation between Gan Yuan Foods and China Merchants Shekou, you can compare the effects of market volatilities on Gan Yuan and China Merchants 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 Gan Yuan with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and China Merchants.
Diversification Opportunities for Gan Yuan and China Merchants
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Gan and China is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou and Gan Yuan 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 Gan Yuan Foods are associated (or correlated) with China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Gan Yuan i.e., Gan Yuan and China Merchants go up and down completely randomly.
Pair Corralation between Gan Yuan and China Merchants
Assuming the 90 days trading horizon Gan Yuan Foods is expected to generate 0.94 times more return on investment than China Merchants. However, Gan Yuan Foods is 1.06 times less risky than China Merchants. It trades about 0.02 of its potential returns per unit of risk. China Merchants Shekou is currently generating about 0.0 per unit of risk. If you would invest 7,183 in Gan Yuan Foods on September 3, 2024 and sell it today you would earn a total of 675.00 from holding Gan Yuan Foods or generate 9.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gan Yuan Foods vs. China Merchants Shekou
Performance |
| Timeline |
| Gan Yuan Foods |
| China Merchants Shekou |
Gan Yuan and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gan Yuan and China Merchants
The main advantage of trading using opposite Gan Yuan and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, China Merchants 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 China Merchants will offset losses from the drop in China Merchants' long position.| Gan Yuan vs. Beijing Wantai Biological | Gan Yuan vs. Aluminum Corp of | Gan Yuan vs. COL Digital Publishing | Gan Yuan vs. Shaanxi Meineng Clean |
| China Merchants vs. Beijing Sanyuan Foods | China Merchants vs. Heilongjiang Publishing Media | China Merchants vs. Gan Yuan Foods | China Merchants vs. China Publishing Media |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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