Correlation Between Empyrean Technology and Guosheng Financial
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By analyzing existing cross correlation between Empyrean Technology Co and Guosheng Financial Holding, you can compare the effects of market volatilities on Empyrean Technology and Guosheng Financial 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 Empyrean Technology with a short position of Guosheng Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empyrean Technology and Guosheng Financial.
Diversification Opportunities for Empyrean Technology and Guosheng Financial
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Empyrean and Guosheng is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Empyrean Technology Co and Guosheng Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guosheng Financial and Empyrean Technology 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 Empyrean Technology Co are associated (or correlated) with Guosheng Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guosheng Financial has no effect on the direction of Empyrean Technology i.e., Empyrean Technology and Guosheng Financial go up and down completely randomly.
Pair Corralation between Empyrean Technology and Guosheng Financial
Assuming the 90 days trading horizon Empyrean Technology Co is expected to generate 1.15 times more return on investment than Guosheng Financial. However, Empyrean Technology is 1.15 times more volatile than Guosheng Financial Holding. It trades about 0.08 of its potential returns per unit of risk. Guosheng Financial Holding is currently generating about 0.03 per unit of risk. If you would invest 7,834 in Empyrean Technology Co on August 29, 2024 and sell it today you would earn a total of 4,368 from holding Empyrean Technology Co or generate 55.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empyrean Technology Co vs. Guosheng Financial Holding
Performance |
| Timeline |
| Empyrean Technology |
| Guosheng Financial |
Empyrean Technology and Guosheng Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empyrean Technology and Guosheng Financial
The main advantage of trading using opposite Empyrean Technology and Guosheng Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empyrean Technology position performs unexpectedly, Guosheng Financial 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 Guosheng Financial will offset losses from the drop in Guosheng Financial's long position.| Empyrean Technology vs. China State Construction | Empyrean Technology vs. Huafa Industrial Co | Empyrean Technology vs. China International Capital | Empyrean Technology vs. Kweichow Moutai Co |
| Guosheng Financial vs. PetroChina Co Ltd | Guosheng Financial vs. China State Construction | Guosheng Financial vs. China Mobile Limited | Guosheng Financial vs. Industrial and Commercial |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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