Correlation Between Guangdong Wens and Geron Co
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By analyzing existing cross correlation between Guangdong Wens Foodstuff and Geron Co, you can compare the effects of market volatilities on Guangdong Wens and Geron Co 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 Wens with a short position of Geron Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Wens and Geron Co.
Diversification Opportunities for Guangdong Wens and Geron Co
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and Geron is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Wens Foodstuff and Geron Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geron Co and Guangdong Wens 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 Wens Foodstuff are associated (or correlated) with Geron Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geron Co has no effect on the direction of Guangdong Wens i.e., Guangdong Wens and Geron Co go up and down completely randomly.
Pair Corralation between Guangdong Wens and Geron Co
Assuming the 90 days trading horizon Guangdong Wens Foodstuff is expected to under-perform the Geron Co. But the stock apears to be less risky and, when comparing its historical volatility, Guangdong Wens Foodstuff is 1.4 times less risky than Geron Co. The stock trades about -0.01 of its potential returns per unit of risk. The Geron Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,414 in Geron Co on December 4, 2024 and sell it today you would earn a total of 180.00 from holding Geron Co or generate 12.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Wens Foodstuff vs. Geron Co
Performance |
| Timeline |
| Guangdong Wens Foodstuff |
| Geron Co |
Guangdong Wens and Geron Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Wens and Geron Co
The main advantage of trading using opposite Guangdong Wens and Geron Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Wens position performs unexpectedly, Geron Co 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 Geron Co will offset losses from the drop in Geron Co's long position.| Guangdong Wens vs. Caihong Display Devices | Guangdong Wens vs. Beijing Kingsoft Office | Guangdong Wens vs. Western Metal Materials | Guangdong Wens vs. Zhengzhou Coal Mining |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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