Correlation Between Gan Yuan and Eastroc Beverage
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By analyzing existing cross correlation between Gan Yuan Foods and Eastroc Beverage Group, you can compare the effects of market volatilities on Gan Yuan and Eastroc Beverage 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 Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and Eastroc Beverage.
Diversification Opportunities for Gan Yuan and Eastroc Beverage
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gan and Eastroc is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage 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 Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Gan Yuan i.e., Gan Yuan and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Gan Yuan and Eastroc Beverage
Assuming the 90 days trading horizon Gan Yuan Foods is expected to generate 1.5 times more return on investment than Eastroc Beverage. However, Gan Yuan is 1.5 times more volatile than Eastroc Beverage Group. It trades about 0.09 of its potential returns per unit of risk. Eastroc Beverage Group is currently generating about 0.03 per unit of risk. If you would invest 7,450 in Gan Yuan Foods on September 5, 2024 and sell it today you would earn a total of 310.00 from holding Gan Yuan Foods or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gan Yuan Foods vs. Eastroc Beverage Group
Performance |
| Timeline |
| Gan Yuan Foods |
| Eastroc Beverage |
Gan Yuan and Eastroc Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gan Yuan and Eastroc Beverage
The main advantage of trading using opposite Gan Yuan and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.| Gan Yuan vs. Nanjing Putian Telecommunications | Gan Yuan vs. Inspur Software Co | Gan Yuan vs. Suzhou Mingzhi Technology | Gan Yuan vs. Guangzhou Haige Communications |
| Eastroc Beverage vs. Chengdu Kanghua Biological | Eastroc Beverage vs. Beijing Wantai Biological | Eastroc Beverage vs. Suzhou Novoprotein Scientific | Eastroc Beverage vs. Aluminum Corp of |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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