Correlation Between Guangzhou Boji and China Reform
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By analyzing existing cross correlation between Guangzhou Boji Medical and China Reform Health, you can compare the effects of market volatilities on Guangzhou Boji and China Reform 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 Guangzhou Boji with a short position of China Reform. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Boji and China Reform.
Diversification Opportunities for Guangzhou Boji and China Reform
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and China is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Boji Medical and China Reform Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Reform Health and Guangzhou Boji 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 Guangzhou Boji Medical are associated (or correlated) with China Reform. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Reform Health has no effect on the direction of Guangzhou Boji i.e., Guangzhou Boji and China Reform go up and down completely randomly.
Pair Corralation between Guangzhou Boji and China Reform
Assuming the 90 days trading horizon Guangzhou Boji is expected to generate 1.04 times less return on investment than China Reform. In addition to that, Guangzhou Boji is 1.01 times more volatile than China Reform Health. It trades about 0.03 of its total potential returns per unit of risk. China Reform Health is currently generating about 0.03 per unit of volatility. If you would invest 1,032 in China Reform Health on September 14, 2024 and sell it today you would earn a total of 290.00 from holding China Reform Health or generate 28.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Boji Medical vs. China Reform Health
Performance |
| Timeline |
| Guangzhou Boji Medical |
| China Reform Health |
Guangzhou Boji and China Reform Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Boji and China Reform
The main advantage of trading using opposite Guangzhou Boji and China Reform positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Boji position performs unexpectedly, China Reform 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 Reform will offset losses from the drop in China Reform's long position.| Guangzhou Boji vs. China Life Insurance | Guangzhou Boji vs. Cinda Securities Co | Guangzhou Boji vs. Piotech Inc A | Guangzhou Boji vs. Dongxing Sec Co |
| China Reform vs. Guangzhou Boji Medical | China Reform vs. Shenzhen Glory Medical | China Reform vs. Changchun BCHT Biotechnology | China Reform vs. Beijing Wandong Medical |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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