Correlation Between Hubei Geoway and Guangdong Shenglu
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By analyzing existing cross correlation between Hubei Geoway Investment and Guangdong Shenglu Telecommunication, you can compare the effects of market volatilities on Hubei Geoway and Guangdong Shenglu 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 Hubei Geoway with a short position of Guangdong Shenglu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Geoway and Guangdong Shenglu.
Diversification Opportunities for Hubei Geoway and Guangdong Shenglu
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hubei and Guangdong is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Geoway Investment and Guangdong Shenglu Telecommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Shenglu and Hubei Geoway 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 Hubei Geoway Investment are associated (or correlated) with Guangdong Shenglu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Shenglu has no effect on the direction of Hubei Geoway i.e., Hubei Geoway and Guangdong Shenglu go up and down completely randomly.
Pair Corralation between Hubei Geoway and Guangdong Shenglu
Assuming the 90 days trading horizon Hubei Geoway Investment is expected to generate 0.95 times more return on investment than Guangdong Shenglu. However, Hubei Geoway Investment is 1.05 times less risky than Guangdong Shenglu. It trades about -0.01 of its potential returns per unit of risk. Guangdong Shenglu Telecommunication is currently generating about -0.02 per unit of risk. If you would invest 203.00 in Hubei Geoway Investment on October 16, 2024 and sell it today you would lose (56.00) from holding Hubei Geoway Investment or give up 27.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Geoway Investment vs. Guangdong Shenglu Telecommunic
Performance |
| Timeline |
| Hubei Geoway Investment |
| Guangdong Shenglu |
Hubei Geoway and Guangdong Shenglu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Geoway and Guangdong Shenglu
The main advantage of trading using opposite Hubei Geoway and Guangdong Shenglu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Geoway position performs unexpectedly, Guangdong Shenglu 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 Guangdong Shenglu will offset losses from the drop in Guangdong Shenglu's long position.| Hubei Geoway vs. Tongxing Environmental Protection | Hubei Geoway vs. Penyao Environmental Protection | Hubei Geoway vs. Shuhua Sports Co | Hubei Geoway vs. Beijing Jiaman Dress |
| Guangdong Shenglu vs. Hubei Geoway Investment | Guangdong Shenglu vs. Cultural Investment Holdings | Guangdong Shenglu vs. Nuode Investment Co | Guangdong Shenglu vs. Vanfund Urban Investment |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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