Correlation Between Guangdong Jinma and China Merchants
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By analyzing existing cross correlation between Guangdong Jinma Entertainment and China Merchants Shekou, you can compare the effects of market volatilities on Guangdong Jinma and China Merchants 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 Jinma with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jinma and China Merchants.
Diversification Opportunities for Guangdong Jinma and China Merchants
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangdong and China is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jinma Entertainment and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou and Guangdong Jinma 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 Jinma Entertainment are associated (or correlated) with China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Guangdong Jinma i.e., Guangdong Jinma and China Merchants go up and down completely randomly.
Pair Corralation between Guangdong Jinma and China Merchants
Assuming the 90 days trading horizon Guangdong Jinma Entertainment is expected to generate 1.24 times more return on investment than China Merchants. However, Guangdong Jinma is 1.24 times more volatile than China Merchants Shekou. It trades about 0.01 of its potential returns per unit of risk. China Merchants Shekou is currently generating about 0.0 per unit of risk. If you would invest 1,690 in Guangdong Jinma Entertainment on September 2, 2024 and sell it today you would lose (29.00) from holding Guangdong Jinma Entertainment or give up 1.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jinma Entertainment vs. China Merchants Shekou
Performance |
| Timeline |
| Guangdong Jinma Ente |
| China Merchants Shekou |
Guangdong Jinma and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jinma and China Merchants
The main advantage of trading using opposite Guangdong Jinma and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jinma position performs unexpectedly, China Merchants 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 Merchants will offset losses from the drop in China Merchants' long position.| Guangdong Jinma vs. Nanjing Putian Telecommunications | Guangdong Jinma vs. Shenzhen Hifuture Electric | Guangdong Jinma vs. Tianjin Realty Development | Guangdong Jinma vs. Shenyang Huitian Thermal |
| China Merchants vs. ChengDu Hi Tech Development | China Merchants vs. FSPG Hi Tech Co | China Merchants vs. Sunwave Communications Co | China Merchants vs. Zhejiang JIULI Hi tech |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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