Correlation Between Iat Automobile and Gome Telecom
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By analyzing existing cross correlation between Iat Automobile Technology and Gome Telecom Equipment, you can compare the effects of market volatilities on Iat Automobile and Gome Telecom 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 Iat Automobile with a short position of Gome Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iat Automobile and Gome Telecom.
Diversification Opportunities for Iat Automobile and Gome Telecom
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Iat and Gome is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Iat Automobile Technology and Gome Telecom Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gome Telecom Equipment and Iat Automobile 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 Iat Automobile Technology are associated (or correlated) with Gome Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gome Telecom Equipment has no effect on the direction of Iat Automobile i.e., Iat Automobile and Gome Telecom go up and down completely randomly.
Pair Corralation between Iat Automobile and Gome Telecom
Assuming the 90 days trading horizon Iat Automobile Technology is expected to generate 1.14 times more return on investment than Gome Telecom. However, Iat Automobile is 1.14 times more volatile than Gome Telecom Equipment. It trades about 0.02 of its potential returns per unit of risk. Gome Telecom Equipment is currently generating about -0.06 per unit of risk. If you would invest 1,282 in Iat Automobile Technology on August 24, 2024 and sell it today you would lose (31.00) from holding Iat Automobile Technology or give up 2.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Iat Automobile Technology vs. Gome Telecom Equipment
Performance |
| Timeline |
| Iat Automobile Technology |
| Gome Telecom Equipment |
Iat Automobile and Gome Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iat Automobile and Gome Telecom
The main advantage of trading using opposite Iat Automobile and Gome Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iat Automobile position performs unexpectedly, Gome Telecom 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 Gome Telecom will offset losses from the drop in Gome Telecom's long position.| Iat Automobile vs. Kweichow Moutai Co | Iat Automobile vs. Contemporary Amperex Technology | Iat Automobile vs. G bits Network Technology | Iat Automobile vs. Beijing Roborock Technology |
| Gome Telecom vs. Jiujiang Shanshui Technology | Gome Telecom vs. Kuangda Technology Group | Gome Telecom vs. Guangzhou Jointas Chemical | Gome Telecom vs. China World Trade |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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