Correlation Between Shanghai Pudong and Gotion High
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By analyzing existing cross correlation between Shanghai Pudong Development and Gotion High tech, you can compare the effects of market volatilities on Shanghai Pudong and Gotion High 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 Shanghai Pudong with a short position of Gotion High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Pudong and Gotion High.
Diversification Opportunities for Shanghai Pudong and Gotion High
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Gotion is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Pudong Development and Gotion High tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gotion High tech and Shanghai Pudong 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 Shanghai Pudong Development are associated (or correlated) with Gotion High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gotion High tech has no effect on the direction of Shanghai Pudong i.e., Shanghai Pudong and Gotion High go up and down completely randomly.
Pair Corralation between Shanghai Pudong and Gotion High
Assuming the 90 days trading horizon Shanghai Pudong Development is expected to under-perform the Gotion High. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Pudong Development is 1.53 times less risky than Gotion High. The stock trades about -0.18 of its potential returns per unit of risk. The Gotion High tech is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 2,316 in Gotion High tech on August 27, 2024 and sell it today you would lose (46.00) from holding Gotion High tech or give up 1.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Pudong Development vs. Gotion High tech
Performance |
| Timeline |
| Shanghai Pudong Deve |
| Gotion High tech |
Shanghai Pudong and Gotion High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Pudong and Gotion High
The main advantage of trading using opposite Shanghai Pudong and Gotion High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Pudong position performs unexpectedly, Gotion High 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 Gotion High will offset losses from the drop in Gotion High's long position.| Shanghai Pudong vs. CICT Mobile Communication | Shanghai Pudong vs. Guangzhou Zhujiang Brewery | Shanghai Pudong vs. State Grid InformationCommunication | Shanghai Pudong vs. Offshore Oil Engineering |
| Gotion High vs. Nuode Investment Co | Gotion High vs. Masterwork Machinery | Gotion High vs. Hunan Tyen Machinery | Gotion High vs. Metro Investment Development |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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