Correlation Between Guangdong Sanhe and Gan Yuan
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By analyzing existing cross correlation between Guangdong Sanhe Pile and Gan Yuan Foods, you can compare the effects of market volatilities on Guangdong Sanhe and Gan Yuan 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 Guangdong Sanhe with a short position of Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Sanhe and Gan Yuan.
Diversification Opportunities for Guangdong Sanhe and Gan Yuan
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Gan is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Sanhe Pile and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods and Guangdong Sanhe 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 Guangdong Sanhe Pile are associated (or correlated) with Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Guangdong Sanhe i.e., Guangdong Sanhe and Gan Yuan go up and down completely randomly.
Pair Corralation between Guangdong Sanhe and Gan Yuan
Assuming the 90 days trading horizon Guangdong Sanhe Pile is expected to generate 1.4 times more return on investment than Gan Yuan. However, Guangdong Sanhe is 1.4 times more volatile than Gan Yuan Foods. It trades about 0.21 of its potential returns per unit of risk. Gan Yuan Foods is currently generating about 0.27 per unit of risk. If you would invest 645.00 in Guangdong Sanhe Pile on September 13, 2024 and sell it today you would earn a total of 90.00 from holding Guangdong Sanhe Pile or generate 13.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Guangdong Sanhe Pile vs. Gan Yuan Foods
Performance |
| Timeline |
| Guangdong Sanhe Pile |
| Gan Yuan Foods |
Guangdong Sanhe and Gan Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Sanhe and Gan Yuan
The main advantage of trading using opposite Guangdong Sanhe and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Sanhe position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.| Guangdong Sanhe vs. Zijin Mining Group | Guangdong Sanhe vs. Wanhua Chemical Group | Guangdong Sanhe vs. Baoshan Iron Steel | Guangdong Sanhe vs. Shandong Gold Mining |
| Gan Yuan vs. Linewell Software Co | Gan Yuan vs. Glodon Software Co | Gan Yuan vs. Gem Year Industrial Co | Gan Yuan vs. Guangdong Jingyi Metal |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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