Correlation Between Guangxi Wuzhou and Shanghai Phichem
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By analyzing existing cross correlation between Guangxi Wuzhou Communications and Shanghai Phichem Material, you can compare the effects of market volatilities on Guangxi Wuzhou and Shanghai Phichem 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 Shanghai Phichem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Wuzhou and Shanghai Phichem.
Diversification Opportunities for Guangxi Wuzhou and Shanghai Phichem
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangxi and Shanghai is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Wuzhou Communications and Shanghai Phichem Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Phichem Material 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 Shanghai Phichem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Phichem Material has no effect on the direction of Guangxi Wuzhou i.e., Guangxi Wuzhou and Shanghai Phichem go up and down completely randomly.
Pair Corralation between Guangxi Wuzhou and Shanghai Phichem
Assuming the 90 days trading horizon Guangxi Wuzhou Communications is expected to under-perform the Shanghai Phichem. In addition to that, Guangxi Wuzhou is 1.23 times more volatile than Shanghai Phichem Material. It trades about -0.18 of its total potential returns per unit of risk. Shanghai Phichem Material is currently generating about -0.09 per unit of volatility. If you would invest 1,659 in Shanghai Phichem Material on October 30, 2024 and sell it today you would lose (74.00) from holding Shanghai Phichem Material or give up 4.46% 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. Shanghai Phichem Material
Performance |
| Timeline |
| Guangxi Wuzhou Commu |
| Shanghai Phichem Material |
Guangxi Wuzhou and Shanghai Phichem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Wuzhou and Shanghai Phichem
The main advantage of trading using opposite Guangxi Wuzhou and Shanghai Phichem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Wuzhou position performs unexpectedly, Shanghai Phichem 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 Shanghai Phichem will offset losses from the drop in Shanghai Phichem's long position.| Guangxi Wuzhou vs. Industrial and Commercial | Guangxi Wuzhou vs. China Construction Bank | Guangxi Wuzhou vs. Agricultural Bank of | Guangxi Wuzhou vs. Bank of China |
| Shanghai Phichem vs. Zijin Mining Group | Shanghai Phichem vs. Wanhua Chemical Group | Shanghai Phichem vs. Baoshan Iron Steel | Shanghai Phichem vs. Shandong Gold Mining |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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