Correlation Between Gome Telecom and HMTNew Technical
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By analyzing existing cross correlation between Gome Telecom Equipment and HMTNew Technical, you can compare the effects of market volatilities on Gome Telecom and HMTNew Technical 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 HMTNew Technical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and HMTNew Technical.
Diversification Opportunities for Gome Telecom and HMTNew Technical
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gome and HMTNew is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and HMTNew Technical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HMTNew Technical 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 HMTNew Technical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HMTNew Technical has no effect on the direction of Gome Telecom i.e., Gome Telecom and HMTNew Technical go up and down completely randomly.
Pair Corralation between Gome Telecom and HMTNew Technical
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to under-perform the HMTNew Technical. In addition to that, Gome Telecom is 1.0 times more volatile than HMTNew Technical. It trades about -0.03 of its total potential returns per unit of risk. HMTNew Technical is currently generating about 0.03 per unit of volatility. If you would invest 3,010 in HMTNew Technical on September 5, 2024 and sell it today you would earn a total of 212.00 from holding HMTNew Technical or generate 7.04% 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. HMTNew Technical
Performance |
| Timeline |
| Gome Telecom Equipment |
| HMTNew Technical |
Gome Telecom and HMTNew Technical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and HMTNew Technical
The main advantage of trading using opposite Gome Telecom and HMTNew Technical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, HMTNew Technical 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 HMTNew Technical will offset losses from the drop in HMTNew Technical's long position.| Gome Telecom vs. Guangzhou KingTeller Technology | Gome Telecom vs. Hoshine Silicon Ind | Gome Telecom vs. Kingsignal Technology Co | Gome Telecom vs. Kangping Technology Co |
| HMTNew Technical vs. Jointo Energy Investment | HMTNew Technical vs. Changchun UP Optotech | HMTNew Technical vs. Sinofibers Technology Co | HMTNew Technical vs. Nuode Investment 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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