Correlation Between Gome Telecom and Bank of XiAn
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By analyzing existing cross correlation between Gome Telecom Equipment and Bank of XiAn, you can compare the effects of market volatilities on Gome Telecom and Bank of XiAn 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 Bank of XiAn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Bank of XiAn.
Diversification Opportunities for Gome Telecom and Bank of XiAn
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gome and Bank is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Bank of XiAn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of XiAn 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 Bank of XiAn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of XiAn has no effect on the direction of Gome Telecom i.e., Gome Telecom and Bank of XiAn go up and down completely randomly.
Pair Corralation between Gome Telecom and Bank of XiAn
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Bank of XiAn. In addition to that, Gome Telecom is 1.69 times more volatile than Bank of XiAn. It trades about -0.19 of its total potential returns per unit of risk. Bank of XiAn is currently generating about 0.08 per unit of volatility. If you would invest 307.00 in Bank of XiAn on November 2, 2024 and sell it today you would earn a total of 44.00 from holding Bank of XiAn or generate 14.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Bank of XiAn
Performance |
| Timeline |
| Gome Telecom Equipment |
| Bank of XiAn |
Gome Telecom and Bank of XiAn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Bank of XiAn
The main advantage of trading using opposite Gome Telecom and Bank of XiAn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Bank of XiAn 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 Bank of XiAn will offset losses from the drop in Bank of XiAn's long position.| Gome Telecom vs. Hainan Haiqi Transportation | Gome Telecom vs. Harbin Hatou Investment | Gome Telecom vs. Dazhong Transportation Group | Gome Telecom vs. Fujian Longzhou Transportation |
| Bank of XiAn vs. Simei Media Co | Bank of XiAn vs. Servyou Software Group | Bank of XiAn vs. Guangdong Jinma Entertainment | Bank of XiAn vs. Ciwen Media 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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