Correlation Between Hua Xia and Guobo Electronics
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By analyzing existing cross correlation between Hua Xia Bank and Guobo Electronics Co, you can compare the effects of market volatilities on Hua Xia and Guobo Electronics 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 Hua Xia with a short position of Guobo Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Xia and Guobo Electronics.
Diversification Opportunities for Hua Xia and Guobo Electronics
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hua and Guobo is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Hua Xia Bank and Guobo Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guobo Electronics and Hua Xia 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 Hua Xia Bank are associated (or correlated) with Guobo Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guobo Electronics has no effect on the direction of Hua Xia i.e., Hua Xia and Guobo Electronics go up and down completely randomly.
Pair Corralation between Hua Xia and Guobo Electronics
Assuming the 90 days trading horizon Hua Xia Bank is expected to generate 0.49 times more return on investment than Guobo Electronics. However, Hua Xia Bank is 2.05 times less risky than Guobo Electronics. It trades about 0.08 of its potential returns per unit of risk. Guobo Electronics Co is currently generating about -0.01 per unit of risk. If you would invest 493.00 in Hua Xia Bank on September 28, 2024 and sell it today you would earn a total of 302.00 from holding Hua Xia Bank or generate 61.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Hua Xia Bank vs. Guobo Electronics Co
Performance |
| Timeline |
| Hua Xia Bank |
| Guobo Electronics |
Hua Xia and Guobo Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Xia and Guobo Electronics
The main advantage of trading using opposite Hua Xia and Guobo Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Xia position performs unexpectedly, Guobo Electronics 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 Guobo Electronics will offset losses from the drop in Guobo Electronics' long position.| Hua Xia vs. Kweichow Moutai Co | Hua Xia vs. Contemporary Amperex Technology | Hua Xia vs. G bits Network Technology | Hua Xia vs. BYD Co Ltd |
| Guobo Electronics vs. Postal Savings Bank | Guobo Electronics vs. HeNan Splendor Science | Guobo Electronics vs. Hua Xia Bank | Guobo Electronics vs. Bloomage Biotechnology Corp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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