Correlation Between Wuhan Yangtze and Gome Telecom
Specify exactly 2 symbols:
By analyzing existing cross correlation between Wuhan Yangtze Communication and Gome Telecom Equipment, you can compare the effects of market volatilities on Wuhan Yangtze and Gome Telecom 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 Wuhan Yangtze with a short position of Gome Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Gome Telecom.
Diversification Opportunities for Wuhan Yangtze and Gome Telecom
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wuhan and Gome is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Gome Telecom Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gome Telecom Equipment and Wuhan Yangtze 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 Wuhan Yangtze Communication are associated (or correlated) with Gome Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gome Telecom Equipment has no effect on the direction of Wuhan Yangtze i.e., Wuhan Yangtze and Gome Telecom go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Gome Telecom
Assuming the 90 days trading horizon Wuhan Yangtze Communication is expected to generate 1.02 times more return on investment than Gome Telecom. However, Wuhan Yangtze is 1.02 times more volatile than Gome Telecom Equipment. It trades about 0.05 of its potential returns per unit of risk. Gome Telecom Equipment is currently generating about -0.06 per unit of risk. If you would invest 1,736 in Wuhan Yangtze Communication on August 24, 2024 and sell it today you would earn a total of 1,131 from holding Wuhan Yangtze Communication or generate 65.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Yangtze Communication vs. Gome Telecom Equipment
Performance |
| Timeline |
| Wuhan Yangtze Commun |
| Gome Telecom Equipment |
Wuhan Yangtze and Gome Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Yangtze and Gome Telecom
The main advantage of trading using opposite Wuhan Yangtze and Gome Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze position performs unexpectedly, Gome Telecom 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 Gome Telecom will offset losses from the drop in Gome Telecom's long position.| Wuhan Yangtze vs. Ming Yang Smart | Wuhan Yangtze vs. 159005 | Wuhan Yangtze vs. Loctek Ergonomic Technology | Wuhan Yangtze vs. Xiamen East Asia |
| Gome Telecom vs. Jiujiang Shanshui Technology | Gome Telecom vs. Kuangda Technology Group | Gome Telecom vs. Guangzhou Jointas Chemical | Gome Telecom vs. China World Trade |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |