Correlation Between Guangdong Silvere and China Railway
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By analyzing existing cross correlation between Guangdong Silvere Sci and China Railway Group, you can compare the effects of market volatilities on Guangdong Silvere and China Railway 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 China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Silvere and China Railway.
Diversification Opportunities for Guangdong Silvere and China Railway
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and China is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Silvere Sci and China Railway Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Group 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 China Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Group has no effect on the direction of Guangdong Silvere i.e., Guangdong Silvere and China Railway go up and down completely randomly.
Pair Corralation between Guangdong Silvere and China Railway
Assuming the 90 days trading horizon Guangdong Silvere Sci is expected to generate 1.8 times more return on investment than China Railway. However, Guangdong Silvere is 1.8 times more volatile than China Railway Group. It trades about 0.02 of its potential returns per unit of risk. China Railway Group is currently generating about -0.13 per unit of risk. If you would invest 643.00 in Guangdong Silvere Sci on November 6, 2024 and sell it today you would earn a total of 5.00 from holding Guangdong Silvere Sci or generate 0.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Silvere Sci vs. China Railway Group
Performance |
| Timeline |
| Guangdong Silvere Sci |
| China Railway Group |
Guangdong Silvere and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Silvere and China Railway
The main advantage of trading using opposite Guangdong Silvere and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Silvere position performs unexpectedly, China Railway 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 Railway will offset losses from the drop in China Railway's long position.| Guangdong Silvere vs. Duzhe Publishing Media | Guangdong Silvere vs. Southern PublishingMedia Co | Guangdong Silvere vs. Threes Company Media | Guangdong Silvere vs. Chengdu Xingrong Investment |
| China Railway vs. Jiangsu Jinling Sports | China Railway vs. Beijing Kaiwen Education | China Railway vs. Caihong Display Devices | China Railway vs. Jiangsu Phoenix Publishing |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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