Correlation Between Guangxi Guiguan and Aurora Optoelectronics
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By analyzing existing cross correlation between Guangxi Guiguan Electric and Aurora Optoelectronics Co, you can compare the effects of market volatilities on Guangxi Guiguan and Aurora Optoelectronics 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 Guangxi Guiguan with a short position of Aurora Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Guiguan and Aurora Optoelectronics.
Diversification Opportunities for Guangxi Guiguan and Aurora Optoelectronics
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangxi and Aurora is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Guiguan Electric and Aurora Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Optoelectronics and Guangxi Guiguan 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 Guangxi Guiguan Electric are associated (or correlated) with Aurora Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Optoelectronics has no effect on the direction of Guangxi Guiguan i.e., Guangxi Guiguan and Aurora Optoelectronics go up and down completely randomly.
Pair Corralation between Guangxi Guiguan and Aurora Optoelectronics
Assuming the 90 days trading horizon Guangxi Guiguan Electric is expected to generate 0.41 times more return on investment than Aurora Optoelectronics. However, Guangxi Guiguan Electric is 2.43 times less risky than Aurora Optoelectronics. It trades about -0.31 of its potential returns per unit of risk. Aurora Optoelectronics Co is currently generating about -0.18 per unit of risk. If you would invest 685.00 in Guangxi Guiguan Electric on October 28, 2024 and sell it today you would lose (58.00) from holding Guangxi Guiguan Electric or give up 8.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangxi Guiguan Electric vs. Aurora Optoelectronics Co
Performance |
| Timeline |
| Guangxi Guiguan Electric |
| Aurora Optoelectronics |
Guangxi Guiguan and Aurora Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Guiguan and Aurora Optoelectronics
The main advantage of trading using opposite Guangxi Guiguan and Aurora Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Guiguan position performs unexpectedly, Aurora Optoelectronics 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 Aurora Optoelectronics will offset losses from the drop in Aurora Optoelectronics' long position.| Guangxi Guiguan vs. Beijing Enlight Media | Guangxi Guiguan vs. Shanghai V Test Semiconductor | Guangxi Guiguan vs. Nexchip Semiconductor Corp | Guangxi Guiguan vs. Sichuan Newsnet Media |
| Aurora Optoelectronics vs. Shanghai Ziyan Foods | Aurora Optoelectronics vs. Haima Automobile Group | Aurora Optoelectronics vs. Wintao Communications Co | Aurora Optoelectronics vs. Tongyu Communication |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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