Correlation Between Guangxi Wuzhou and Xiangpiaopiao Food
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By analyzing existing cross correlation between Guangxi Wuzhou Communications and Xiangpiaopiao Food Co, you can compare the effects of market volatilities on Guangxi Wuzhou and Xiangpiaopiao Food 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 Xiangpiaopiao Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangxi Wuzhou and Xiangpiaopiao Food.
Diversification Opportunities for Guangxi Wuzhou and Xiangpiaopiao Food
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangxi and Xiangpiaopiao is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Guangxi Wuzhou Communications and Xiangpiaopiao Food Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangpiaopiao Food 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 Xiangpiaopiao Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangpiaopiao Food has no effect on the direction of Guangxi Wuzhou i.e., Guangxi Wuzhou and Xiangpiaopiao Food go up and down completely randomly.
Pair Corralation between Guangxi Wuzhou and Xiangpiaopiao Food
Assuming the 90 days trading horizon Guangxi Wuzhou Communications is expected to under-perform the Xiangpiaopiao Food. But the stock apears to be less risky and, when comparing its historical volatility, Guangxi Wuzhou Communications is 1.16 times less risky than Xiangpiaopiao Food. The stock trades about -0.05 of its potential returns per unit of risk. The Xiangpiaopiao Food Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,551 in Xiangpiaopiao Food Co on October 18, 2024 and sell it today you would earn a total of 44.00 from holding Xiangpiaopiao Food Co or generate 2.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangxi Wuzhou Communications vs. Xiangpiaopiao Food Co
Performance |
| Timeline |
| Guangxi Wuzhou Commu |
| Xiangpiaopiao Food |
Guangxi Wuzhou and Xiangpiaopiao Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangxi Wuzhou and Xiangpiaopiao Food
The main advantage of trading using opposite Guangxi Wuzhou and Xiangpiaopiao Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangxi Wuzhou position performs unexpectedly, Xiangpiaopiao Food 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 Xiangpiaopiao Food will offset losses from the drop in Xiangpiaopiao Food's long position.| Guangxi Wuzhou vs. China Petroleum Chemical | Guangxi Wuzhou vs. PetroChina Co Ltd | Guangxi Wuzhou vs. China State Construction | Guangxi Wuzhou vs. China Railway Group |
| Xiangpiaopiao Food vs. Tsingtao Brewery Co | Xiangpiaopiao Food vs. Easyhome New Retail | Xiangpiaopiao Food vs. Qumei Furniture Group | Xiangpiaopiao Food vs. DO Home Collection |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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