Correlation Between Pengxin International and Hangzhou Gisway
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By analyzing existing cross correlation between Pengxin International Mining and Hangzhou Gisway Information, you can compare the effects of market volatilities on Pengxin International and Hangzhou Gisway 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 Pengxin International with a short position of Hangzhou Gisway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and Hangzhou Gisway.
Diversification Opportunities for Pengxin International and Hangzhou Gisway
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pengxin and Hangzhou is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and Hangzhou Gisway Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Gisway Info and Pengxin International 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 Pengxin International Mining are associated (or correlated) with Hangzhou Gisway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Gisway Info has no effect on the direction of Pengxin International i.e., Pengxin International and Hangzhou Gisway go up and down completely randomly.
Pair Corralation between Pengxin International and Hangzhou Gisway
Assuming the 90 days trading horizon Pengxin International Mining is expected to under-perform the Hangzhou Gisway. In addition to that, Pengxin International is 1.14 times more volatile than Hangzhou Gisway Information. It trades about -0.19 of its total potential returns per unit of risk. Hangzhou Gisway Information is currently generating about -0.15 per unit of volatility. If you would invest 3,561 in Hangzhou Gisway Information on October 28, 2024 and sell it today you would lose (374.00) from holding Hangzhou Gisway Information or give up 10.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pengxin International Mining vs. Hangzhou Gisway Information
Performance |
| Timeline |
| Pengxin International |
| Hangzhou Gisway Info |
Pengxin International and Hangzhou Gisway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pengxin International and Hangzhou Gisway
The main advantage of trading using opposite Pengxin International and Hangzhou Gisway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, Hangzhou Gisway 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 Hangzhou Gisway will offset losses from the drop in Hangzhou Gisway's long position.The idea behind Pengxin International Mining and Hangzhou Gisway Information pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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