Correlation Between Grinm Advanced and Guangzhou Automobile
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By analyzing existing cross correlation between Grinm Advanced Materials and Guangzhou Automobile Group, you can compare the effects of market volatilities on Grinm Advanced and Guangzhou Automobile 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 Grinm Advanced with a short position of Guangzhou Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grinm Advanced and Guangzhou Automobile.
Diversification Opportunities for Grinm Advanced and Guangzhou Automobile
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Grinm and Guangzhou is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Grinm Advanced Materials and Guangzhou Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Automobile and Grinm Advanced 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 Grinm Advanced Materials are associated (or correlated) with Guangzhou Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Automobile has no effect on the direction of Grinm Advanced i.e., Grinm Advanced and Guangzhou Automobile go up and down completely randomly.
Pair Corralation between Grinm Advanced and Guangzhou Automobile
Assuming the 90 days trading horizon Grinm Advanced Materials is expected to generate 2.77 times more return on investment than Guangzhou Automobile. However, Grinm Advanced is 2.77 times more volatile than Guangzhou Automobile Group. It trades about 0.47 of its potential returns per unit of risk. Guangzhou Automobile Group is currently generating about 0.19 per unit of risk. If you would invest 1,150 in Grinm Advanced Materials on September 1, 2024 and sell it today you would earn a total of 1,097 from holding Grinm Advanced Materials or generate 95.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grinm Advanced Materials vs. Guangzhou Automobile Group
Performance |
| Timeline |
| Grinm Advanced Materials |
| Guangzhou Automobile |
Grinm Advanced and Guangzhou Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grinm Advanced and Guangzhou Automobile
The main advantage of trading using opposite Grinm Advanced and Guangzhou Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grinm Advanced position performs unexpectedly, Guangzhou Automobile 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 Automobile will offset losses from the drop in Guangzhou Automobile's long position.| Grinm Advanced vs. Chengtun Mining Group | Grinm Advanced vs. Hengdian Entertainment Co | Grinm Advanced vs. Uroica Mining Safety | Grinm Advanced vs. Tibet Huayu Mining |
| Guangzhou Automobile vs. Anhui Huaren Health | Guangzhou Automobile vs. Shanghai Broadband Technology | Guangzhou Automobile vs. Healthcare Co | Guangzhou Automobile vs. Dezhan HealthCare 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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