Correlation Between Guangzhou Ruoyuchen and Hubei Xingfa
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By analyzing existing cross correlation between Guangzhou Ruoyuchen Information and Hubei Xingfa Chemicals, you can compare the effects of market volatilities on Guangzhou Ruoyuchen and Hubei Xingfa 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 Hubei Xingfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Ruoyuchen and Hubei Xingfa.
Diversification Opportunities for Guangzhou Ruoyuchen and Hubei Xingfa
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Hubei is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Ruoyuchen Informatio and Hubei Xingfa Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Xingfa Chemicals 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 Hubei Xingfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Xingfa Chemicals has no effect on the direction of Guangzhou Ruoyuchen i.e., Guangzhou Ruoyuchen and Hubei Xingfa go up and down completely randomly.
Pair Corralation between Guangzhou Ruoyuchen and Hubei Xingfa
Assuming the 90 days trading horizon Guangzhou Ruoyuchen Information is expected to generate 1.59 times more return on investment than Hubei Xingfa. However, Guangzhou Ruoyuchen is 1.59 times more volatile than Hubei Xingfa Chemicals. It trades about 0.31 of its potential returns per unit of risk. Hubei Xingfa Chemicals is currently generating about 0.03 per unit of risk. If you would invest 1,419 in Guangzhou Ruoyuchen Information on August 25, 2024 and sell it today you would earn a total of 488.00 from holding Guangzhou Ruoyuchen Information or generate 34.39% 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. Hubei Xingfa Chemicals
Performance |
| Timeline |
| Guangzhou Ruoyuchen |
| Hubei Xingfa Chemicals |
Guangzhou Ruoyuchen and Hubei Xingfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Ruoyuchen and Hubei Xingfa
The main advantage of trading using opposite Guangzhou Ruoyuchen and Hubei Xingfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Ruoyuchen position performs unexpectedly, Hubei Xingfa 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 Hubei Xingfa will offset losses from the drop in Hubei Xingfa'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 |
| Hubei Xingfa vs. Guangzhou Ruoyuchen Information | Hubei Xingfa vs. Northking Information Technology | Hubei Xingfa vs. Tonghua Grape Wine | Hubei Xingfa vs. Xiamen Goldenhome Co |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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