Correlation Between Guangdong Silvere and Wuxi Chemical
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By analyzing existing cross correlation between Guangdong Silvere Sci and Wuxi Chemical Equipment, you can compare the effects of market volatilities on Guangdong Silvere and Wuxi Chemical 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 Silvere with a short position of Wuxi Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Silvere and Wuxi Chemical.
Diversification Opportunities for Guangdong Silvere and Wuxi Chemical
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangdong and Wuxi is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Silvere Sci and Wuxi Chemical Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuxi Chemical Equipment and Guangdong Silvere 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 Silvere Sci are associated (or correlated) with Wuxi Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuxi Chemical Equipment has no effect on the direction of Guangdong Silvere i.e., Guangdong Silvere and Wuxi Chemical go up and down completely randomly.
Pair Corralation between Guangdong Silvere and Wuxi Chemical
Assuming the 90 days trading horizon Guangdong Silvere Sci is expected to under-perform the Wuxi Chemical. In addition to that, Guangdong Silvere is 1.52 times more volatile than Wuxi Chemical Equipment. It trades about -0.35 of its total potential returns per unit of risk. Wuxi Chemical Equipment is currently generating about -0.18 per unit of volatility. If you would invest 3,625 in Wuxi Chemical Equipment on October 14, 2024 and sell it today you would lose (275.00) from holding Wuxi Chemical Equipment or give up 7.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Silvere Sci vs. Wuxi Chemical Equipment
Performance |
| Timeline |
| Guangdong Silvere Sci |
| Wuxi Chemical Equipment |
Guangdong Silvere and Wuxi Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Silvere and Wuxi Chemical
The main advantage of trading using opposite Guangdong Silvere and Wuxi Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Silvere position performs unexpectedly, Wuxi Chemical 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 Wuxi Chemical will offset losses from the drop in Wuxi Chemical's long position.| Guangdong Silvere vs. Sichuan Fulin Transportation | Guangdong Silvere vs. Cansino Biologics | Guangdong Silvere vs. Gansu Huangtai Wine marketing | Guangdong Silvere vs. Jiangsu Yueda Investment |
| Wuxi Chemical vs. Guangdong Silvere Sci | Wuxi Chemical vs. Uroica Mining Safety | Wuxi Chemical vs. Zhejiang JIULI Hi tech | Wuxi Chemical vs. Xinjiang Baodi Mining |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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