Correlation Between Gome Telecom and Nantong Haixing
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By analyzing existing cross correlation between Gome Telecom Equipment and Nantong Haixing Electronics, you can compare the effects of market volatilities on Gome Telecom and Nantong Haixing 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 Nantong Haixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and Nantong Haixing.
Diversification Opportunities for Gome Telecom and Nantong Haixing
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gome and Nantong is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and Nantong Haixing Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nantong Haixing Elec 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 Nantong Haixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nantong Haixing Elec has no effect on the direction of Gome Telecom i.e., Gome Telecom and Nantong Haixing go up and down completely randomly.
Pair Corralation between Gome Telecom and Nantong Haixing
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the Nantong Haixing. In addition to that, Gome Telecom is 1.51 times more volatile than Nantong Haixing Electronics. It trades about -0.06 of its total potential returns per unit of risk. Nantong Haixing Electronics is currently generating about 0.0 per unit of volatility. If you would invest 1,595 in Nantong Haixing Electronics on September 3, 2024 and sell it today you would lose (185.00) from holding Nantong Haixing Electronics or give up 11.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gome Telecom Equipment vs. Nantong Haixing Electronics
Performance |
| Timeline |
| Gome Telecom Equipment |
| Nantong Haixing Elec |
Gome Telecom and Nantong Haixing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and Nantong Haixing
The main advantage of trading using opposite Gome Telecom and Nantong Haixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, Nantong Haixing 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 Nantong Haixing will offset losses from the drop in Nantong Haixing'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 |
| Nantong Haixing vs. Glodon Software Co | Nantong Haixing vs. Hangzhou Pinming Software | Nantong Haixing vs. Shenzhen Glory Medical | Nantong Haixing vs. CareRay Digital Medical |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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