Correlation Between Guangzhou Haozhi and Shantui Construction
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By analyzing existing cross correlation between Guangzhou Haozhi Industrial and Shantui Construction Machinery, you can compare the effects of market volatilities on Guangzhou Haozhi and Shantui Construction 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 Haozhi with a short position of Shantui Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haozhi and Shantui Construction.
Diversification Opportunities for Guangzhou Haozhi and Shantui Construction
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Shantui is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haozhi Industrial and Shantui Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shantui Construction and Guangzhou Haozhi 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 Haozhi Industrial are associated (or correlated) with Shantui Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shantui Construction has no effect on the direction of Guangzhou Haozhi i.e., Guangzhou Haozhi and Shantui Construction go up and down completely randomly.
Pair Corralation between Guangzhou Haozhi and Shantui Construction
Assuming the 90 days trading horizon Guangzhou Haozhi is expected to generate 2.93 times less return on investment than Shantui Construction. In addition to that, Guangzhou Haozhi is 1.55 times more volatile than Shantui Construction Machinery. It trades about 0.06 of its total potential returns per unit of risk. Shantui Construction Machinery is currently generating about 0.27 per unit of volatility. If you would invest 839.00 in Shantui Construction Machinery on August 29, 2024 and sell it today you would earn a total of 175.00 from holding Shantui Construction Machinery or generate 20.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haozhi Industrial vs. Shantui Construction Machinery
Performance |
| Timeline |
| Guangzhou Haozhi Ind |
| Shantui Construction |
Guangzhou Haozhi and Shantui Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haozhi and Shantui Construction
The main advantage of trading using opposite Guangzhou Haozhi and Shantui Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haozhi position performs unexpectedly, Shantui Construction 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 Shantui Construction will offset losses from the drop in Shantui Construction's long position.| Guangzhou Haozhi vs. Biwin Storage Technology | Guangzhou Haozhi vs. PetroChina Co Ltd | Guangzhou Haozhi vs. Industrial and Commercial | Guangzhou Haozhi vs. China Construction Bank |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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