Correlation Between Guangzhou Ruoyuchen and Aerospace
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By analyzing existing cross correlation between Guangzhou Ruoyuchen Information and Aerospace Hi Tech Holding, you can compare the effects of market volatilities on Guangzhou Ruoyuchen and Aerospace 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 Guangzhou Ruoyuchen with a short position of Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Ruoyuchen and Aerospace.
Diversification Opportunities for Guangzhou Ruoyuchen and Aerospace
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Guangzhou and Aerospace is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Ruoyuchen Informatio and Aerospace Hi Tech Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aerospace Hi Tech and Guangzhou Ruoyuchen 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 Guangzhou Ruoyuchen Information are associated (or correlated) with Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aerospace Hi Tech has no effect on the direction of Guangzhou Ruoyuchen i.e., Guangzhou Ruoyuchen and Aerospace go up and down completely randomly.
Pair Corralation between Guangzhou Ruoyuchen and Aerospace
Assuming the 90 days trading horizon Guangzhou Ruoyuchen Information is expected to generate 2.47 times more return on investment than Aerospace. However, Guangzhou Ruoyuchen is 2.47 times more volatile than Aerospace Hi Tech Holding. It trades about -0.06 of its potential returns per unit of risk. Aerospace Hi Tech Holding is currently generating about -0.26 per unit of risk. If you would invest 2,960 in Guangzhou Ruoyuchen Information on October 25, 2024 and sell it today you would lose (237.00) from holding Guangzhou Ruoyuchen Information or give up 8.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Ruoyuchen Informatio vs. Aerospace Hi Tech Holding
Performance |
| Timeline |
| Guangzhou Ruoyuchen |
| Aerospace Hi Tech |
Guangzhou Ruoyuchen and Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Ruoyuchen and Aerospace
The main advantage of trading using opposite Guangzhou Ruoyuchen and Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Ruoyuchen position performs unexpectedly, Aerospace 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 Aerospace will offset losses from the drop in Aerospace's long position.| Guangzhou Ruoyuchen vs. Industrial and Commercial | Guangzhou Ruoyuchen vs. Agricultural Bank of | Guangzhou Ruoyuchen vs. China Construction Bank | Guangzhou Ruoyuchen vs. Bank of China |
| Aerospace vs. PetroChina Co Ltd | Aerospace vs. Gansu Jiu Steel | Aerospace vs. Ming Yang Smart | Aerospace vs. Aba Chemicals Corp |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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