Correlation Between Guangxi Wuzhou and Dongguan Tarry
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By analyzing existing cross correlation between Guangxi Wuzhou Communications and Dongguan Tarry Electronics, you can compare the effects of market volatilities on Guangxi Wuzhou and Dongguan Tarry 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 Dongguan Tarry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Wuzhou and Dongguan Tarry.
Diversification Opportunities for Guangxi Wuzhou and Dongguan Tarry
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangxi and Dongguan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Wuzhou Communications and Dongguan Tarry Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Tarry Elect 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 Dongguan Tarry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Tarry Elect has no effect on the direction of Guangxi Wuzhou i.e., Guangxi Wuzhou and Dongguan Tarry go up and down completely randomly.
Pair Corralation between Guangxi Wuzhou and Dongguan Tarry
Assuming the 90 days trading horizon Guangxi Wuzhou Communications is expected to generate 1.31 times more return on investment than Dongguan Tarry. However, Guangxi Wuzhou is 1.31 times more volatile than Dongguan Tarry Electronics. It trades about 0.09 of its potential returns per unit of risk. Dongguan Tarry Electronics is currently generating about -0.14 per unit of risk. If you would invest 426.00 in Guangxi Wuzhou Communications on October 14, 2024 and sell it today you would earn a total of 31.00 from holding Guangxi Wuzhou Communications or generate 7.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangxi Wuzhou Communications vs. Dongguan Tarry Electronics
Performance |
| Timeline |
| Guangxi Wuzhou Commu |
| Dongguan Tarry Elect |
Guangxi Wuzhou and Dongguan Tarry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Wuzhou and Dongguan Tarry
The main advantage of trading using opposite Guangxi Wuzhou and Dongguan Tarry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Wuzhou position performs unexpectedly, Dongguan Tarry 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 Dongguan Tarry will offset losses from the drop in Dongguan Tarry's long position.| Guangxi Wuzhou vs. Anhui Tongguan Copper | Guangxi Wuzhou vs. Guocheng Mining Co | Guangxi Wuzhou vs. Chengdu Spaceon Electronics | Guangxi Wuzhou vs. Hainan Mining Co |
| Dongguan Tarry vs. Jiangsu Jinling Sports | Dongguan Tarry vs. Guangxi Wuzhou Communications | Dongguan Tarry vs. XinJiang GuoTong Pipeline | Dongguan Tarry vs. Runjian Communication 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 Stocks Directory module to find actively traded stocks across global markets.
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