Correlation Between Hangzhou Guotai and Beijing YanDong
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By analyzing existing cross correlation between Hangzhou Guotai Environmental and Beijing YanDong MicroElectronic, you can compare the effects of market volatilities on Hangzhou Guotai and Beijing YanDong 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 Beijing YanDong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Guotai and Beijing YanDong.
Diversification Opportunities for Hangzhou Guotai and Beijing YanDong
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hangzhou and Beijing is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Guotai Environmental and Beijing YanDong MicroElectroni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing YanDong Micr 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 Beijing YanDong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing YanDong Micr has no effect on the direction of Hangzhou Guotai i.e., Hangzhou Guotai and Beijing YanDong go up and down completely randomly.
Pair Corralation between Hangzhou Guotai and Beijing YanDong
Assuming the 90 days trading horizon Hangzhou Guotai Environmental is expected to generate 1.14 times more return on investment than Beijing YanDong. However, Hangzhou Guotai is 1.14 times more volatile than Beijing YanDong MicroElectronic. It trades about 0.19 of its potential returns per unit of risk. Beijing YanDong MicroElectronic is currently generating about -0.08 per unit of risk. If you would invest 2,870 in Hangzhou Guotai Environmental on October 28, 2024 and sell it today you would earn a total of 293.00 from holding Hangzhou Guotai Environmental or generate 10.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Guotai Environmental vs. Beijing YanDong MicroElectroni
Performance |
| Timeline |
| Hangzhou Guotai Envi |
| Beijing YanDong Micr |
Hangzhou Guotai and Beijing YanDong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Guotai and Beijing YanDong
The main advantage of trading using opposite Hangzhou Guotai and Beijing YanDong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Guotai position performs unexpectedly, Beijing YanDong 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 Beijing YanDong will offset losses from the drop in Beijing YanDong's long position.| Hangzhou Guotai vs. Industrial and Commercial | Hangzhou Guotai vs. Agricultural Bank of | Hangzhou Guotai vs. China Construction Bank | Hangzhou Guotai vs. Bank of China |
| Beijing YanDong vs. Western Metal Materials | Beijing YanDong vs. Fiberhome Telecommunication Technologies | Beijing YanDong vs. Guangxi Wuzhou Communications | Beijing YanDong vs. Orinko Advanced Plastics |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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