Correlation Between Guangzhou Haozhi and Agricultural Bank
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By analyzing existing cross correlation between Guangzhou Haozhi Industrial and Agricultural Bank of, you can compare the effects of market volatilities on Guangzhou Haozhi and Agricultural Bank 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 Agricultural Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haozhi and Agricultural Bank.
Diversification Opportunities for Guangzhou Haozhi and Agricultural Bank
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangzhou and Agricultural is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haozhi Industrial and Agricultural Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agricultural Bank 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 Agricultural Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agricultural Bank has no effect on the direction of Guangzhou Haozhi i.e., Guangzhou Haozhi and Agricultural Bank go up and down completely randomly.
Pair Corralation between Guangzhou Haozhi and Agricultural Bank
Assuming the 90 days trading horizon Guangzhou Haozhi Industrial is expected to generate 2.95 times more return on investment than Agricultural Bank. However, Guangzhou Haozhi is 2.95 times more volatile than Agricultural Bank of. It trades about 0.44 of its potential returns per unit of risk. Agricultural Bank of is currently generating about 0.08 per unit of risk. If you would invest 1,700 in Guangzhou Haozhi Industrial on November 7, 2024 and sell it today you would earn a total of 489.00 from holding Guangzhou Haozhi Industrial or generate 28.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Haozhi Industrial vs. Agricultural Bank of
Performance |
| Timeline |
| Guangzhou Haozhi Ind |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Agricultural Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Guangzhou Haozhi and Agricultural Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Haozhi and Agricultural Bank
The main advantage of trading using opposite Guangzhou Haozhi and Agricultural Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haozhi position performs unexpectedly, Agricultural Bank 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 Agricultural Bank will offset losses from the drop in Agricultural Bank's long position.The idea behind Guangzhou Haozhi Industrial and Agricultural Bank of pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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