Correlation Between Dongfeng Automobile and Guangzhou Boji
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By analyzing existing cross correlation between Dongfeng Automobile Co and Guangzhou Boji Medical, you can compare the effects of market volatilities on Dongfeng Automobile and Guangzhou Boji 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 Dongfeng Automobile with a short position of Guangzhou Boji. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Guangzhou Boji.
Diversification Opportunities for Dongfeng Automobile and Guangzhou Boji
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dongfeng and Guangzhou is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Guangzhou Boji Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Boji Medical and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with Guangzhou Boji. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Boji Medical has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Guangzhou Boji go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Guangzhou Boji
Assuming the 90 days trading horizon Dongfeng Automobile Co is expected to generate 1.67 times more return on investment than Guangzhou Boji. However, Dongfeng Automobile is 1.67 times more volatile than Guangzhou Boji Medical. It trades about 0.15 of its potential returns per unit of risk. Guangzhou Boji Medical is currently generating about 0.0 per unit of risk. If you would invest 654.00 in Dongfeng Automobile Co on September 3, 2024 and sell it today you would earn a total of 82.00 from holding Dongfeng Automobile Co or generate 12.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. Guangzhou Boji Medical
Performance |
| Timeline |
| Dongfeng Automobile |
| Guangzhou Boji Medical |
Dongfeng Automobile and Guangzhou Boji Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongfeng Automobile and Guangzhou Boji
The main advantage of trading using opposite Dongfeng Automobile and Guangzhou Boji positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Guangzhou Boji 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 Boji will offset losses from the drop in Guangzhou Boji's long position.| Dongfeng Automobile vs. Hunan Investment Group | Dongfeng Automobile vs. Vanfund Urban Investment | Dongfeng Automobile vs. Shenzhen Centralcon Investment | Dongfeng Automobile vs. Dareway Software Co |
| Guangzhou Boji vs. Chengdu Kanghua Biological | Guangzhou Boji vs. Beijing Wantai Biological | Guangzhou Boji vs. Suzhou Novoprotein Scientific | Guangzhou Boji vs. Aluminum Corp of |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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