Correlation Between Gome Telecom and Xingyuan Environment
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By analyzing existing cross correlation between Gome Telecom Equipment and Xingyuan Environment Technology, you can compare the effects of market volatilities on Gome Telecom and Xingyuan Environment 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 Xingyuan Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Xingyuan Environment.
Diversification Opportunities for Gome Telecom and Xingyuan Environment
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gome and Xingyuan is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Xingyuan Environment Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingyuan Environment 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 Xingyuan Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xingyuan Environment has no effect on the direction of Gome Telecom i.e., Gome Telecom and Xingyuan Environment go up and down completely randomly.
Pair Corralation between Gome Telecom and Xingyuan Environment
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Xingyuan Environment. But the stock apears to be less risky and, when comparing its historical volatility, Gome Telecom Equipment is 1.38 times less risky than Xingyuan Environment. The stock trades about -0.03 of its potential returns per unit of risk. The Xingyuan Environment Technology is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 306.00 in Xingyuan Environment Technology on September 2, 2024 and sell it today you would earn a total of 11.00 from holding Xingyuan Environment Technology or generate 3.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Xingyuan Environment Technolog
Performance |
| Timeline |
| Gome Telecom Equipment |
| Xingyuan Environment |
Gome Telecom and Xingyuan Environment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Xingyuan Environment
The main advantage of trading using opposite Gome Telecom and Xingyuan Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Xingyuan Environment 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 Xingyuan Environment will offset losses from the drop in Xingyuan Environment's long position.| Gome Telecom vs. Ming Yang Smart | Gome Telecom vs. 159681 | Gome Telecom vs. 159005 | Gome Telecom vs. Loctek Ergonomic Technology |
| Xingyuan Environment vs. New China Life | Xingyuan Environment vs. Ming Yang Smart | Xingyuan Environment vs. 159681 | Xingyuan Environment vs. 159005 |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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