Correlation Between Chongqing Brewery and Great Sun
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By analyzing existing cross correlation between Chongqing Brewery Co and Great Sun Foods Co, you can compare the effects of market volatilities on Chongqing Brewery and Great Sun 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 Chongqing Brewery with a short position of Great Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Brewery and Great Sun.
Diversification Opportunities for Chongqing Brewery and Great Sun
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chongqing and Great is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Brewery Co and Great Sun Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Sun Foods and Chongqing Brewery 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 Chongqing Brewery Co are associated (or correlated) with Great Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Sun Foods has no effect on the direction of Chongqing Brewery i.e., Chongqing Brewery and Great Sun go up and down completely randomly.
Pair Corralation between Chongqing Brewery and Great Sun
Assuming the 90 days trading horizon Chongqing Brewery Co is expected to generate 0.65 times more return on investment than Great Sun. However, Chongqing Brewery Co is 1.54 times less risky than Great Sun. It trades about 0.14 of its potential returns per unit of risk. Great Sun Foods Co is currently generating about -0.05 per unit of risk. If you would invest 6,063 in Chongqing Brewery Co on September 26, 2024 and sell it today you would earn a total of 354.00 from holding Chongqing Brewery Co or generate 5.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Brewery Co vs. Great Sun Foods Co
Performance |
| Timeline |
| Chongqing Brewery |
| Great Sun Foods |
Chongqing Brewery and Great Sun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Brewery and Great Sun
The main advantage of trading using opposite Chongqing Brewery and Great Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Brewery position performs unexpectedly, Great Sun 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 Great Sun will offset losses from the drop in Great Sun's long position.| Chongqing Brewery vs. BYD Co Ltd | Chongqing Brewery vs. China Mobile Limited | Chongqing Brewery vs. Agricultural Bank of | Chongqing Brewery vs. Industrial and Commercial |
| Great Sun vs. Ming Yang Smart | Great Sun vs. 159681 | Great Sun vs. 159005 | Great Sun vs. Loctek Ergonomic Technology |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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