Correlation Between Guangdong Jinming and Hangzhou Gaoxin
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By analyzing existing cross correlation between Guangdong Jinming Machinery and Hangzhou Gaoxin Rubber, you can compare the effects of market volatilities on Guangdong Jinming and Hangzhou Gaoxin 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 Jinming with a short position of Hangzhou Gaoxin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jinming and Hangzhou Gaoxin.
Diversification Opportunities for Guangdong Jinming and Hangzhou Gaoxin
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Hangzhou is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jinming Machinery and Hangzhou Gaoxin Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Gaoxin Rubber and Guangdong Jinming 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 Jinming Machinery are associated (or correlated) with Hangzhou Gaoxin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Gaoxin Rubber has no effect on the direction of Guangdong Jinming i.e., Guangdong Jinming and Hangzhou Gaoxin go up and down completely randomly.
Pair Corralation between Guangdong Jinming and Hangzhou Gaoxin
Assuming the 90 days trading horizon Guangdong Jinming Machinery is expected to generate 1.58 times more return on investment than Hangzhou Gaoxin. However, Guangdong Jinming is 1.58 times more volatile than Hangzhou Gaoxin Rubber. It trades about 0.13 of its potential returns per unit of risk. Hangzhou Gaoxin Rubber is currently generating about 0.07 per unit of risk. If you would invest 649.00 in Guangdong Jinming Machinery on September 13, 2024 and sell it today you would earn a total of 51.00 from holding Guangdong Jinming Machinery or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jinming Machinery vs. Hangzhou Gaoxin Rubber
Performance |
| Timeline |
| Guangdong Jinming |
| Hangzhou Gaoxin Rubber |
Guangdong Jinming and Hangzhou Gaoxin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jinming and Hangzhou Gaoxin
The main advantage of trading using opposite Guangdong Jinming and Hangzhou Gaoxin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jinming position performs unexpectedly, Hangzhou Gaoxin 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 Hangzhou Gaoxin will offset losses from the drop in Hangzhou Gaoxin's long position.| Guangdong Jinming vs. Industrial and Commercial | Guangdong Jinming vs. Kweichow Moutai Co | Guangdong Jinming vs. Agricultural Bank of | Guangdong Jinming vs. China Mobile Limited |
| Hangzhou Gaoxin vs. Hangzhou Coco Healthcare | Hangzhou Gaoxin vs. Everjoy Health Group | Hangzhou Gaoxin vs. Hangzhou Pinming Software | Hangzhou Gaoxin vs. Glodon Software 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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