Correlation Between Hangzhou Guotai and Guangzhou KDT
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By analyzing existing cross correlation between Hangzhou Guotai Environmental and Guangzhou KDT Machinery, you can compare the effects of market volatilities on Hangzhou Guotai and Guangzhou KDT 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 Hangzhou Guotai with a short position of Guangzhou KDT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Guotai and Guangzhou KDT.
Diversification Opportunities for Hangzhou Guotai and Guangzhou KDT
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hangzhou and Guangzhou is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Guotai Environmental and Guangzhou KDT Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou KDT Machinery and Hangzhou Guotai 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 Hangzhou Guotai Environmental are associated (or correlated) with Guangzhou KDT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou KDT Machinery has no effect on the direction of Hangzhou Guotai i.e., Hangzhou Guotai and Guangzhou KDT go up and down completely randomly.
Pair Corralation between Hangzhou Guotai and Guangzhou KDT
Assuming the 90 days trading horizon Hangzhou Guotai Environmental is expected to generate 1.44 times more return on investment than Guangzhou KDT. However, Hangzhou Guotai is 1.44 times more volatile than Guangzhou KDT Machinery. It trades about -0.04 of its potential returns per unit of risk. Guangzhou KDT Machinery is currently generating about -0.47 per unit of risk. If you would invest 3,140 in Hangzhou Guotai Environmental on October 12, 2024 and sell it today you would lose (70.00) from holding Hangzhou Guotai Environmental or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Guotai Environmental vs. Guangzhou KDT Machinery
Performance |
| Timeline |
| Hangzhou Guotai Envi |
| Guangzhou KDT Machinery |
Hangzhou Guotai and Guangzhou KDT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Guotai and Guangzhou KDT
The main advantage of trading using opposite Hangzhou Guotai and Guangzhou KDT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Guotai position performs unexpectedly, Guangzhou KDT 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 Guangzhou KDT will offset losses from the drop in Guangzhou KDT's long position.| Hangzhou Guotai vs. HUAQIN TECHNOLOGY LTD | Hangzhou Guotai vs. Soyea Technology Co | Hangzhou Guotai vs. Kuangda Technology Group | Hangzhou Guotai vs. Kingsignal Technology Co |
| Guangzhou KDT vs. Elite Color Environmental | Guangzhou KDT vs. Central Plains Environment | Guangzhou KDT vs. Changjiang Jinggong Steel | Guangzhou KDT vs. Hangzhou Guotai Environmental |
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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