Correlation Between Metro Investment and Gotion High
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By analyzing existing cross correlation between Metro Investment Development and Gotion High tech, you can compare the effects of market volatilities on Metro Investment and Gotion High 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 Metro Investment with a short position of Gotion High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metro Investment and Gotion High.
Diversification Opportunities for Metro Investment and Gotion High
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Metro and Gotion is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Metro Investment Development and Gotion High tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gotion High tech and Metro Investment 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 Metro Investment Development are associated (or correlated) with Gotion High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gotion High tech has no effect on the direction of Metro Investment i.e., Metro Investment and Gotion High go up and down completely randomly.
Pair Corralation between Metro Investment and Gotion High
Assuming the 90 days trading horizon Metro Investment is expected to generate 1.0 times less return on investment than Gotion High. But when comparing it to its historical volatility, Metro Investment Development is 1.25 times less risky than Gotion High. It trades about 0.06 of its potential returns per unit of risk. Gotion High tech is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,265 in Gotion High tech on August 31, 2024 and sell it today you would earn a total of 49.00 from holding Gotion High tech or generate 2.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Metro Investment Development vs. Gotion High tech
Performance |
| Timeline |
| Metro Investment Dev |
| Gotion High tech |
Metro Investment and Gotion High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metro Investment and Gotion High
The main advantage of trading using opposite Metro Investment and Gotion High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metro Investment position performs unexpectedly, Gotion High 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 Gotion High will offset losses from the drop in Gotion High's long position.| Metro Investment vs. Kweichow Moutai Co | Metro Investment vs. Contemporary Amperex Technology | Metro Investment vs. G bits Network Technology | Metro Investment vs. BYD Co Ltd |
| Gotion High vs. Jinhe Biotechnology Co | Gotion High vs. Shuhua Sports Co | Gotion High vs. Focus Media Information | Gotion High vs. Guangdong Marubi Biotechnology |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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