Correlation Between Guangzhou Ruoyuchen and China Merchants
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By analyzing existing cross correlation between Guangzhou Ruoyuchen Information and China Merchants Shekou, you can compare the effects of market volatilities on Guangzhou Ruoyuchen 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 Guangzhou Ruoyuchen with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Ruoyuchen and China Merchants.
Diversification Opportunities for Guangzhou Ruoyuchen and China Merchants
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangzhou and China is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Ruoyuchen Informatio 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 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 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 Guangzhou Ruoyuchen i.e., Guangzhou Ruoyuchen and China Merchants go up and down completely randomly.
Pair Corralation between Guangzhou Ruoyuchen and China Merchants
Assuming the 90 days trading horizon Guangzhou Ruoyuchen Information is expected to generate 2.29 times more return on investment than China Merchants. However, Guangzhou Ruoyuchen is 2.29 times more volatile than China Merchants Shekou. It trades about 0.28 of its potential returns per unit of risk. China Merchants Shekou is currently generating about -0.02 per unit of risk. If you would invest 3,050 in Guangzhou Ruoyuchen Information on December 9, 2024 and sell it today you would earn a total of 783.00 from holding Guangzhou Ruoyuchen Information or generate 25.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Ruoyuchen Informatio vs. China Merchants Shekou
Performance |
| Timeline |
| Guangzhou Ruoyuchen |
| China Merchants Shekou |
Guangzhou Ruoyuchen and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Ruoyuchen and China Merchants
The main advantage of trading using opposite Guangzhou Ruoyuchen and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Ruoyuchen 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.| Guangzhou Ruoyuchen vs. Hubei Xingfa Chemicals | ||
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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