Correlation Between Guangxi Wuzhou and Yunnan Hongxiang
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By analyzing existing cross correlation between Guangxi Wuzhou Communications and Yunnan Hongxiang Yixintang, you can compare the effects of market volatilities on Guangxi Wuzhou and Yunnan Hongxiang 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 Wuzhou with a short position of Yunnan Hongxiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Wuzhou and Yunnan Hongxiang.
Diversification Opportunities for Guangxi Wuzhou and Yunnan Hongxiang
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangxi and Yunnan is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Wuzhou Communications and Yunnan Hongxiang Yixintang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yunnan Hongxiang Yix and Guangxi Wuzhou 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 Wuzhou Communications are associated (or correlated) with Yunnan Hongxiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yunnan Hongxiang Yix has no effect on the direction of Guangxi Wuzhou i.e., Guangxi Wuzhou and Yunnan Hongxiang go up and down completely randomly.
Pair Corralation between Guangxi Wuzhou and Yunnan Hongxiang
Assuming the 90 days trading horizon Guangxi Wuzhou Communications is expected to under-perform the Yunnan Hongxiang. In addition to that, Guangxi Wuzhou is 2.0 times more volatile than Yunnan Hongxiang Yixintang. It trades about -0.25 of its total potential returns per unit of risk. Yunnan Hongxiang Yixintang is currently generating about -0.06 per unit of volatility. If you would invest 1,266 in Yunnan Hongxiang Yixintang on November 2, 2024 and sell it today you would lose (20.00) from holding Yunnan Hongxiang Yixintang or give up 1.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangxi Wuzhou Communications vs. Yunnan Hongxiang Yixintang
Performance |
| Timeline |
| Guangxi Wuzhou Commu |
| Yunnan Hongxiang Yix |
Guangxi Wuzhou and Yunnan Hongxiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Wuzhou and Yunnan Hongxiang
The main advantage of trading using opposite Guangxi Wuzhou and Yunnan Hongxiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Wuzhou position performs unexpectedly, Yunnan Hongxiang 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 Yunnan Hongxiang will offset losses from the drop in Yunnan Hongxiang's long position.| Guangxi Wuzhou vs. Hubei Geoway Investment | Guangxi Wuzhou vs. Juneyao Airlines | Guangxi Wuzhou vs. Beijing Mainstreets Investment | Guangxi Wuzhou vs. Henan Shuanghui Investment |
| Yunnan Hongxiang vs. Kunwu Jiuding Investment | Yunnan Hongxiang vs. Zhongrun Resources Investment | Yunnan Hongxiang vs. Chengdu Xingrong Investment | Yunnan Hongxiang vs. Malion New Materials |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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