Correlation Between Guangzhou Ruoyuchen and Tongding Interconnection
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By analyzing existing cross correlation between Guangzhou Ruoyuchen Information and Tongding Interconnection Information, you can compare the effects of market volatilities on Guangzhou Ruoyuchen and Tongding Interconnection 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 Tongding Interconnection. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Ruoyuchen and Tongding Interconnection.
Diversification Opportunities for Guangzhou Ruoyuchen and Tongding Interconnection
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Tongding is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Ruoyuchen Informatio and Tongding Interconnection Infor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongding Interconnection 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 Tongding Interconnection. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongding Interconnection has no effect on the direction of Guangzhou Ruoyuchen i.e., Guangzhou Ruoyuchen and Tongding Interconnection go up and down completely randomly.
Pair Corralation between Guangzhou Ruoyuchen and Tongding Interconnection
Assuming the 90 days trading horizon Guangzhou Ruoyuchen Information is expected to generate 1.29 times more return on investment than Tongding Interconnection. However, Guangzhou Ruoyuchen is 1.29 times more volatile than Tongding Interconnection Information. It trades about 0.05 of its potential returns per unit of risk. Tongding Interconnection Information is currently generating about 0.01 per unit of risk. If you would invest 1,174 in Guangzhou Ruoyuchen Information on August 28, 2024 and sell it today you would earn a total of 819.00 from holding Guangzhou Ruoyuchen Information or generate 69.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Ruoyuchen Informatio vs. Tongding Interconnection Infor
Performance |
| Timeline |
| Guangzhou Ruoyuchen |
| Tongding Interconnection |
Guangzhou Ruoyuchen and Tongding Interconnection Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Ruoyuchen and Tongding Interconnection
The main advantage of trading using opposite Guangzhou Ruoyuchen and Tongding Interconnection positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Ruoyuchen position performs unexpectedly, Tongding Interconnection 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 Tongding Interconnection will offset losses from the drop in Tongding Interconnection'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 |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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