Correlation Between Gan Yuan and Changchun BCHT
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By analyzing existing cross correlation between Gan Yuan Foods and Changchun BCHT Biotechnology, you can compare the effects of market volatilities on Gan Yuan and Changchun BCHT 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 Changchun BCHT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and Changchun BCHT.
Diversification Opportunities for Gan Yuan and Changchun BCHT
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gan and Changchun is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and Changchun BCHT Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun BCHT Biote 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 Changchun BCHT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun BCHT Biote has no effect on the direction of Gan Yuan i.e., Gan Yuan and Changchun BCHT go up and down completely randomly.
Pair Corralation between Gan Yuan and Changchun BCHT
Assuming the 90 days trading horizon Gan Yuan Foods is expected to generate 0.79 times more return on investment than Changchun BCHT. However, Gan Yuan Foods is 1.26 times less risky than Changchun BCHT. It trades about 0.14 of its potential returns per unit of risk. Changchun BCHT Biotechnology is currently generating about -0.14 per unit of risk. If you would invest 7,030 in Gan Yuan Foods on August 29, 2024 and sell it today you would earn a total of 432.00 from holding Gan Yuan Foods or generate 6.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gan Yuan Foods vs. Changchun BCHT Biotechnology
Performance |
| Timeline |
| Gan Yuan Foods |
| Changchun BCHT Biote |
Gan Yuan and Changchun BCHT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gan Yuan and Changchun BCHT
The main advantage of trading using opposite Gan Yuan and Changchun BCHT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, Changchun BCHT 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 Changchun BCHT will offset losses from the drop in Changchun BCHT's long position.| Gan Yuan vs. Marssenger Kitchenware Co | Gan Yuan vs. XinJiang GuoTong Pipeline | Gan Yuan vs. Yindu Kitchen Equipment | Gan Yuan vs. Zhejiang Kingland Pipeline |
| Changchun BCHT vs. Industrial and Commercial | Changchun BCHT vs. Agricultural Bank of | Changchun BCHT vs. China Construction Bank | Changchun BCHT vs. Bank of China |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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