Correlation Between Gan Yuan and Guangzhou KingTeller
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By analyzing existing cross correlation between Gan Yuan Foods and Guangzhou KingTeller Technology, you can compare the effects of market volatilities on Gan Yuan and Guangzhou KingTeller 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 Guangzhou KingTeller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and Guangzhou KingTeller.
Diversification Opportunities for Gan Yuan and Guangzhou KingTeller
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gan and Guangzhou is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and Guangzhou KingTeller Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou KingTeller 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 Guangzhou KingTeller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou KingTeller has no effect on the direction of Gan Yuan i.e., Gan Yuan and Guangzhou KingTeller go up and down completely randomly.
Pair Corralation between Gan Yuan and Guangzhou KingTeller
Assuming the 90 days trading horizon Gan Yuan Foods is expected to under-perform the Guangzhou KingTeller. In addition to that, Gan Yuan is 1.01 times more volatile than Guangzhou KingTeller Technology. It trades about -0.1 of its total potential returns per unit of risk. Guangzhou KingTeller Technology is currently generating about 0.13 per unit of volatility. If you would invest 441.00 in Guangzhou KingTeller Technology on November 8, 2024 and sell it today you would earn a total of 30.00 from holding Guangzhou KingTeller Technology or generate 6.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Gan Yuan Foods vs. Guangzhou KingTeller Technolog
Performance |
| Timeline |
| Gan Yuan Foods |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Guangzhou KingTeller |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gan Yuan and Guangzhou KingTeller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gan Yuan and Guangzhou KingTeller
The main advantage of trading using opposite Gan Yuan and Guangzhou KingTeller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, Guangzhou KingTeller 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 Guangzhou KingTeller will offset losses from the drop in Guangzhou KingTeller's long position.The idea behind Gan Yuan Foods and Guangzhou KingTeller Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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