Correlation Between Gome Telecom and Cultural Investment
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By analyzing existing cross correlation between Gome Telecom Equipment and Cultural Investment Holdings, you can compare the effects of market volatilities on Gome Telecom and Cultural Investment 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 Cultural Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Cultural Investment.
Diversification Opportunities for Gome Telecom and Cultural Investment
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gome and Cultural is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Cultural Investment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cultural Investment 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 Cultural Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cultural Investment has no effect on the direction of Gome Telecom i.e., Gome Telecom and Cultural Investment go up and down completely randomly.
Pair Corralation between Gome Telecom and Cultural Investment
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Cultural Investment. But the stock apears to be less risky and, when comparing its historical volatility, Gome Telecom Equipment is 1.2 times less risky than Cultural Investment. The stock trades about -0.12 of its potential returns per unit of risk. The Cultural Investment Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 237.00 in Cultural Investment Holdings on November 2, 2024 and sell it today you would lose (28.00) from holding Cultural Investment Holdings or give up 11.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Cultural Investment Holdings
Performance |
| Timeline |
| Gome Telecom Equipment |
| Cultural Investment |
Gome Telecom and Cultural Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Cultural Investment
The main advantage of trading using opposite Gome Telecom and Cultural Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Cultural Investment 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 Cultural Investment will offset losses from the drop in Cultural Investment's long position.| Gome Telecom vs. Shenzhen Shenbao Industrial | Gome Telecom vs. Ningbo Fujia Industrial | Gome Telecom vs. Semiconductor Manufacturing Intl | Gome Telecom vs. Guangzhou Haozhi Industrial |
| Cultural Investment vs. Suzhou Weizhixiang Food | Cultural Investment vs. Guizhou Chanhen Chemical | Cultural Investment vs. Gan Yuan Foods | Cultural Investment vs. Bsm Chemical 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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