Correlation Between Yingde Greatchem and Guangdong Liantai
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By analyzing existing cross correlation between Yingde Greatchem Chemicals and Guangdong Liantai Environmental, you can compare the effects of market volatilities on Yingde Greatchem and Guangdong Liantai 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 Yingde Greatchem with a short position of Guangdong Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yingde Greatchem and Guangdong Liantai.
Diversification Opportunities for Yingde Greatchem and Guangdong Liantai
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yingde and Guangdong is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Yingde Greatchem Chemicals and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai and Yingde Greatchem 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 Yingde Greatchem Chemicals are associated (or correlated) with Guangdong Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of Yingde Greatchem i.e., Yingde Greatchem and Guangdong Liantai go up and down completely randomly.
Pair Corralation between Yingde Greatchem and Guangdong Liantai
Assuming the 90 days trading horizon Yingde Greatchem Chemicals is expected to generate 1.25 times more return on investment than Guangdong Liantai. However, Yingde Greatchem is 1.25 times more volatile than Guangdong Liantai Environmental. It trades about 0.04 of its potential returns per unit of risk. Guangdong Liantai Environmental is currently generating about 0.0 per unit of risk. If you would invest 2,000 in Yingde Greatchem Chemicals on November 5, 2024 and sell it today you would earn a total of 325.00 from holding Yingde Greatchem Chemicals or generate 16.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yingde Greatchem Chemicals vs. Guangdong Liantai Environmenta
Performance |
| Timeline |
| Yingde Greatchem Che |
| Guangdong Liantai |
Yingde Greatchem and Guangdong Liantai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yingde Greatchem and Guangdong Liantai
The main advantage of trading using opposite Yingde Greatchem and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yingde Greatchem position performs unexpectedly, Guangdong Liantai 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 Liantai will offset losses from the drop in Guangdong Liantai's long position.| Yingde Greatchem vs. Shengda Mining Co | Yingde Greatchem vs. Holitech Technology Co | Yingde Greatchem vs. Shenyang Blue Silver | Yingde Greatchem vs. Hubei Forbon Technology |
| Guangdong Liantai vs. Changjiang Publishing Media | Guangdong Liantai vs. Beijing Enlight Media | Guangdong Liantai vs. Guangzhou Jinyi Media | Guangdong Liantai vs. Chengdu B ray Media |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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