Correlation Between Gome Telecom and Super Dragon
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By analyzing existing cross correlation between Gome Telecom Equipment and Super Dragon Engineering Plastics, you can compare the effects of market volatilities on Gome Telecom and Super Dragon 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 Super Dragon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Super Dragon.
Diversification Opportunities for Gome Telecom and Super Dragon
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gome and Super is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Super Dragon Engineering Plast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super Dragon Enginee 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 Super Dragon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super Dragon Enginee has no effect on the direction of Gome Telecom i.e., Gome Telecom and Super Dragon go up and down completely randomly.
Pair Corralation between Gome Telecom and Super Dragon
Assuming the 90 days trading horizon Gome Telecom is expected to generate 1.24 times less return on investment than Super Dragon. But when comparing it to its historical volatility, Gome Telecom Equipment is 1.0 times less risky than Super Dragon. It trades about 0.11 of its potential returns per unit of risk. Super Dragon Engineering Plastics is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,996 in Super Dragon Engineering Plastics on September 3, 2024 and sell it today you would earn a total of 899.00 from holding Super Dragon Engineering Plastics or generate 30.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Super Dragon Engineering Plast
Performance |
| Timeline |
| Gome Telecom Equipment |
| Super Dragon Enginee |
Gome Telecom and Super Dragon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Super Dragon
The main advantage of trading using opposite Gome Telecom and Super Dragon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Super Dragon 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 Super Dragon will offset losses from the drop in Super Dragon's long position.| Gome Telecom vs. PetroChina Co Ltd | Gome Telecom vs. China Mobile Limited | Gome Telecom vs. Industrial and Commercial | Gome Telecom vs. China Life Insurance |
| Super Dragon vs. Cultural Investment Holdings | Super Dragon vs. Gome Telecom Equipment | Super Dragon vs. Bus Online Co | Super Dragon vs. Holitech Technology Co |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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