Correlation Between Guangxi Wuzhou and Sinomach Automobile
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By analyzing existing cross correlation between Guangxi Wuzhou Communications and Sinomach Automobile Co, you can compare the effects of market volatilities on Guangxi Wuzhou and Sinomach Automobile 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 Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Wuzhou and Sinomach Automobile.
Diversification Opportunities for Guangxi Wuzhou and Sinomach Automobile
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Guangxi and Sinomach is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Wuzhou Communications and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile 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 Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Guangxi Wuzhou i.e., Guangxi Wuzhou and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Guangxi Wuzhou and Sinomach Automobile
Assuming the 90 days trading horizon Guangxi Wuzhou Communications is expected to generate 1.37 times more return on investment than Sinomach Automobile. However, Guangxi Wuzhou is 1.37 times more volatile than Sinomach Automobile Co. It trades about 0.11 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about -0.05 per unit of risk. If you would invest 372.00 in Guangxi Wuzhou Communications on October 14, 2024 and sell it today you would earn a total of 85.00 from holding Guangxi Wuzhou Communications or generate 22.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangxi Wuzhou Communications vs. Sinomach Automobile Co
Performance |
| Timeline |
| Guangxi Wuzhou Commu |
| Sinomach Automobile |
Guangxi Wuzhou and Sinomach Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Wuzhou and Sinomach Automobile
The main advantage of trading using opposite Guangxi Wuzhou and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Wuzhou position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile'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 |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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