Correlation Between Shenzhen Mindray and Guangdong Advertising
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By analyzing existing cross correlation between Shenzhen Mindray Bio Medical and Guangdong Advertising Co, you can compare the effects of market volatilities on Shenzhen Mindray and Guangdong Advertising 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 Shenzhen Mindray with a short position of Guangdong Advertising. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Mindray and Guangdong Advertising.
Diversification Opportunities for Shenzhen Mindray and Guangdong Advertising
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shenzhen and Guangdong is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Mindray Bio Medical and Guangdong Advertising Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Advertising and Shenzhen Mindray 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 Shenzhen Mindray Bio Medical are associated (or correlated) with Guangdong Advertising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Advertising has no effect on the direction of Shenzhen Mindray i.e., Shenzhen Mindray and Guangdong Advertising go up and down completely randomly.
Pair Corralation between Shenzhen Mindray and Guangdong Advertising
Assuming the 90 days trading horizon Shenzhen Mindray Bio Medical is expected to under-perform the Guangdong Advertising. But the stock apears to be less risky and, when comparing its historical volatility, Shenzhen Mindray Bio Medical is 3.75 times less risky than Guangdong Advertising. The stock trades about -0.23 of its potential returns per unit of risk. The Guangdong Advertising Co is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 709.00 in Guangdong Advertising Co on September 13, 2024 and sell it today you would earn a total of 302.00 from holding Guangdong Advertising Co or generate 42.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Mindray Bio Medical vs. Guangdong Advertising Co
Performance |
| Timeline |
| Shenzhen Mindray Bio |
| Guangdong Advertising |
Shenzhen Mindray and Guangdong Advertising Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Mindray and Guangdong Advertising
The main advantage of trading using opposite Shenzhen Mindray and Guangdong Advertising positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Mindray position performs unexpectedly, Guangdong Advertising 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 Guangdong Advertising will offset losses from the drop in Guangdong Advertising's long position.| Shenzhen Mindray vs. Industrial and Commercial | Shenzhen Mindray vs. Kweichow Moutai Co | Shenzhen Mindray vs. Agricultural Bank of | Shenzhen Mindray vs. China Mobile Limited |
| Guangdong Advertising vs. BYD Co Ltd | Guangdong Advertising vs. China Mobile Limited | Guangdong Advertising vs. Agricultural Bank of | Guangdong Advertising vs. Industrial and Commercial |
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 CEOs Directory module to screen CEOs from public companies around the world.
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