Correlation Between Guangdong Wens and Youyou Foods
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By analyzing existing cross correlation between Guangdong Wens Foodstuff and Youyou Foods Co, you can compare the effects of market volatilities on Guangdong Wens and Youyou Foods 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 Youyou Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Wens and Youyou Foods.
Diversification Opportunities for Guangdong Wens and Youyou Foods
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangdong and Youyou is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Wens Foodstuff and Youyou Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youyou Foods 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 Youyou Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youyou Foods has no effect on the direction of Guangdong Wens i.e., Guangdong Wens and Youyou Foods go up and down completely randomly.
Pair Corralation between Guangdong Wens and Youyou Foods
Assuming the 90 days trading horizon Guangdong Wens Foodstuff is expected to generate 0.42 times more return on investment than Youyou Foods. However, Guangdong Wens Foodstuff is 2.37 times less risky than Youyou Foods. It trades about -0.15 of its potential returns per unit of risk. Youyou Foods Co is currently generating about -0.13 per unit of risk. If you would invest 1,734 in Guangdong Wens Foodstuff on October 30, 2024 and sell it today you would lose (121.00) from holding Guangdong Wens Foodstuff or give up 6.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Wens Foodstuff vs. Youyou Foods Co
Performance |
| Timeline |
| Guangdong Wens Foodstuff |
| Youyou Foods |
Guangdong Wens and Youyou Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Wens and Youyou Foods
The main advantage of trading using opposite Guangdong Wens and Youyou Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Wens position performs unexpectedly, Youyou Foods 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 Youyou Foods will offset losses from the drop in Youyou Foods' long position.| Guangdong Wens vs. Changjiang Publishing Media | Guangdong Wens vs. COL Digital Publishing | Guangdong Wens vs. Inspur Software Co | Guangdong Wens vs. Dhc Software Co |
| Youyou Foods vs. Markor International Home | Youyou Foods vs. Beijing Kingsoft Office | Youyou Foods vs. Ziel Home Furnishing | Youyou Foods vs. DO Home Collection |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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