Correlation Between Gome Telecom and Xinjiang Tianshun
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By analyzing existing cross correlation between Gome Telecom Equipment and Xinjiang Tianshun Supply, you can compare the effects of market volatilities on Gome Telecom and Xinjiang Tianshun 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 Xinjiang Tianshun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Xinjiang Tianshun.
Diversification Opportunities for Gome Telecom and Xinjiang Tianshun
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gome and Xinjiang is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Xinjiang Tianshun Supply in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Tianshun Supply 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 Xinjiang Tianshun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Tianshun Supply has no effect on the direction of Gome Telecom i.e., Gome Telecom and Xinjiang Tianshun go up and down completely randomly.
Pair Corralation between Gome Telecom and Xinjiang Tianshun
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Xinjiang Tianshun. In addition to that, Gome Telecom is 1.23 times more volatile than Xinjiang Tianshun Supply. It trades about -0.04 of its total potential returns per unit of risk. Xinjiang Tianshun Supply is currently generating about 0.03 per unit of volatility. If you would invest 1,066 in Xinjiang Tianshun Supply on September 12, 2024 and sell it today you would earn a total of 226.00 from holding Xinjiang Tianshun Supply or generate 21.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.71% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Xinjiang Tianshun Supply
Performance |
| Timeline |
| Gome Telecom Equipment |
| Xinjiang Tianshun Supply |
Gome Telecom and Xinjiang Tianshun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Xinjiang Tianshun
The main advantage of trading using opposite Gome Telecom and Xinjiang Tianshun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Xinjiang Tianshun 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 Xinjiang Tianshun will offset losses from the drop in Xinjiang Tianshun'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 |
| Xinjiang Tianshun vs. Beijing SPC Environment | Xinjiang Tianshun vs. Hang Xiao Steel | Xinjiang Tianshun vs. King Strong New Material | Xinjiang Tianshun vs. Tianjin Capital Environmental |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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