Correlation Between Shanghai Pudong and Guangxi Wuzhou
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By analyzing existing cross correlation between Shanghai Pudong Development and Guangxi Wuzhou Communications, you can compare the effects of market volatilities on Shanghai Pudong and Guangxi Wuzhou 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 Guangxi Wuzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Pudong and Guangxi Wuzhou.
Diversification Opportunities for Shanghai Pudong and Guangxi Wuzhou
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Guangxi is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Pudong Development and Guangxi Wuzhou Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangxi Wuzhou Commu 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 Guangxi Wuzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangxi Wuzhou Commu has no effect on the direction of Shanghai Pudong i.e., Shanghai Pudong and Guangxi Wuzhou go up and down completely randomly.
Pair Corralation between Shanghai Pudong and Guangxi Wuzhou
Assuming the 90 days trading horizon Shanghai Pudong Development is expected to under-perform the Guangxi Wuzhou. In addition to that, Shanghai Pudong is 1.06 times more volatile than Guangxi Wuzhou Communications. It trades about -0.16 of its total potential returns per unit of risk. Guangxi Wuzhou Communications is currently generating about 0.09 per unit of volatility. If you would invest 379.00 in Guangxi Wuzhou Communications on September 3, 2024 and sell it today you would earn a total of 10.00 from holding Guangxi Wuzhou Communications or generate 2.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Pudong Development vs. Guangxi Wuzhou Communications
Performance |
| Timeline |
| Shanghai Pudong Deve |
| Guangxi Wuzhou Commu |
Shanghai Pudong and Guangxi Wuzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Pudong and Guangxi Wuzhou
The main advantage of trading using opposite Shanghai Pudong and Guangxi Wuzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Pudong position performs unexpectedly, Guangxi Wuzhou 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 Guangxi Wuzhou will offset losses from the drop in Guangxi Wuzhou's long position.| Shanghai Pudong vs. Jilin Jlu Communication | Shanghai Pudong vs. Zhongtong Guomai Communication | Shanghai Pudong vs. Wintao Communications Co | Shanghai Pudong vs. Muyuan Foodstuff Co |
| Guangxi Wuzhou vs. Cultural Investment Holdings | Guangxi Wuzhou vs. Gome Telecom Equipment | Guangxi Wuzhou vs. Bus Online Co | Guangxi Wuzhou vs. Holitech Technology Co |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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