Correlation Between COL Digital and Guangzhou Zhujiang
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By analyzing existing cross correlation between COL Digital Publishing and Guangzhou Zhujiang Brewery, you can compare the effects of market volatilities on COL Digital and Guangzhou Zhujiang 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 COL Digital with a short position of Guangzhou Zhujiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of COL Digital and Guangzhou Zhujiang.
Diversification Opportunities for COL Digital and Guangzhou Zhujiang
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between COL and Guangzhou is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding COL Digital Publishing and Guangzhou Zhujiang Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Zhujiang and COL Digital 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 COL Digital Publishing are associated (or correlated) with Guangzhou Zhujiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Zhujiang has no effect on the direction of COL Digital i.e., COL Digital and Guangzhou Zhujiang go up and down completely randomly.
Pair Corralation between COL Digital and Guangzhou Zhujiang
Assuming the 90 days trading horizon COL Digital Publishing is expected to generate 3.18 times more return on investment than Guangzhou Zhujiang. However, COL Digital is 3.18 times more volatile than Guangzhou Zhujiang Brewery. It trades about 0.06 of its potential returns per unit of risk. Guangzhou Zhujiang Brewery is currently generating about 0.03 per unit of risk. If you would invest 1,871 in COL Digital Publishing on September 1, 2024 and sell it today you would earn a total of 1,167 from holding COL Digital Publishing or generate 62.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COL Digital Publishing vs. Guangzhou Zhujiang Brewery
Performance |
| Timeline |
| COL Digital Publishing |
| Guangzhou Zhujiang |
COL Digital and Guangzhou Zhujiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COL Digital and Guangzhou Zhujiang
The main advantage of trading using opposite COL Digital and Guangzhou Zhujiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COL Digital position performs unexpectedly, Guangzhou Zhujiang 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 Guangzhou Zhujiang will offset losses from the drop in Guangzhou Zhujiang's long position.| COL Digital vs. Guangdong Advertising Co | COL Digital vs. Wuhan Hvsen Biotechnology | COL Digital vs. Heilongjiang Publishing Media | COL Digital vs. Shanghai Xinhua Media |
| Guangzhou Zhujiang vs. Shanghai Metersbonwe FashionAccessories | Guangzhou Zhujiang vs. Xiwang Foodstuffs Co | Guangzhou Zhujiang vs. JuneYao Dairy Co | Guangzhou Zhujiang vs. Xiamen Jihong Package |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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