Correlation Between Gome Telecom and Songz Automobile
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By analyzing existing cross correlation between Gome Telecom Equipment and Songz Automobile Air, you can compare the effects of market volatilities on Gome Telecom and Songz 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 Gome Telecom with a short position of Songz Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Songz Automobile.
Diversification Opportunities for Gome Telecom and Songz Automobile
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gome and Songz is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Songz Automobile Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Songz Automobile Air and Gome Telecom 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 Gome Telecom Equipment are associated (or correlated) with Songz Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Songz Automobile Air has no effect on the direction of Gome Telecom i.e., Gome Telecom and Songz Automobile go up and down completely randomly.
Pair Corralation between Gome Telecom and Songz Automobile
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to generate 1.54 times more return on investment than Songz Automobile. However, Gome Telecom is 1.54 times more volatile than Songz Automobile Air. It trades about 0.0 of its potential returns per unit of risk. Songz Automobile Air is currently generating about -0.1 per unit of risk. If you would invest 185.00 in Gome Telecom Equipment on September 12, 2024 and sell it today you would lose (2.00) from holding Gome Telecom Equipment or give up 1.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Songz Automobile Air
Performance |
| Timeline |
| Gome Telecom Equipment |
| Songz Automobile Air |
Gome Telecom and Songz Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Songz Automobile
The main advantage of trading using opposite Gome Telecom and Songz Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Songz 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 Songz Automobile will offset losses from the drop in Songz Automobile's long position.| Gome Telecom vs. Lutian Machinery Co | Gome Telecom vs. PetroChina Co Ltd | Gome Telecom vs. Bank of China | Gome Telecom vs. Gansu Jiu Steel |
| Songz Automobile vs. Lutian Machinery Co | Songz Automobile vs. PetroChina Co Ltd | Songz Automobile vs. Bank of China | Songz Automobile vs. Gansu Jiu Steel |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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