Correlation Between Panda Dairy and Gan Yuan
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By analyzing existing cross correlation between Panda Dairy Corp and Gan Yuan Foods, you can compare the effects of market volatilities on Panda Dairy and Gan Yuan 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 Panda Dairy with a short position of Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panda Dairy and Gan Yuan.
Diversification Opportunities for Panda Dairy and Gan Yuan
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Panda and Gan is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Panda Dairy Corp and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods and Panda Dairy 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 Panda Dairy Corp are associated (or correlated) with Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Panda Dairy i.e., Panda Dairy and Gan Yuan go up and down completely randomly.
Pair Corralation between Panda Dairy and Gan Yuan
Assuming the 90 days trading horizon Panda Dairy is expected to generate 13.43 times less return on investment than Gan Yuan. In addition to that, Panda Dairy is 1.4 times more volatile than Gan Yuan Foods. It trades about 0.0 of its total potential returns per unit of risk. Gan Yuan Foods is currently generating about 0.09 per unit of volatility. If you would invest 7,020 in Gan Yuan Foods on August 26, 2024 and sell it today you would earn a total of 245.00 from holding Gan Yuan Foods or generate 3.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Panda Dairy Corp vs. Gan Yuan Foods
Performance |
| Timeline |
| Panda Dairy Corp |
| Gan Yuan Foods |
Panda Dairy and Gan Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Panda Dairy and Gan Yuan
The main advantage of trading using opposite Panda Dairy and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panda Dairy position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.| Panda Dairy vs. China Petroleum Chemical | Panda Dairy vs. PetroChina Co Ltd | Panda Dairy vs. China State Construction | Panda Dairy vs. China Railway Group |
| Gan Yuan vs. China Petroleum Chemical | Gan Yuan vs. PetroChina Co Ltd | Gan Yuan vs. China State Construction | Gan Yuan vs. China Railway Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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