Correlation Between Gome Telecom and RoadMain T
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By analyzing existing cross correlation between Gome Telecom Equipment and RoadMain T Co, you can compare the effects of market volatilities on Gome Telecom and RoadMain T 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 RoadMain T. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gome Telecom and RoadMain T.
Diversification Opportunities for Gome Telecom and RoadMain T
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gome and RoadMain is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Gome Telecom Equipment and RoadMain T Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RoadMain T 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 RoadMain T. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RoadMain T has no effect on the direction of Gome Telecom i.e., Gome Telecom and RoadMain T go up and down completely randomly.
Pair Corralation between Gome Telecom and RoadMain T
Assuming the 90 days trading horizon Gome Telecom Equipment is expected to generate 1.77 times more return on investment than RoadMain T. However, Gome Telecom is 1.77 times more volatile than RoadMain T Co. It trades about 0.01 of its potential returns per unit of risk. RoadMain T Co is currently generating about -0.13 per unit of risk. If you would invest 196.00 in Gome Telecom Equipment on August 31, 2024 and sell it today you would lose (1.00) from holding Gome Telecom Equipment or give up 0.51% 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. RoadMain T Co
Performance |
| Timeline |
| Gome Telecom Equipment |
| RoadMain T |
Gome Telecom and RoadMain T Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gome Telecom and RoadMain T
The main advantage of trading using opposite Gome Telecom and RoadMain T positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gome Telecom position performs unexpectedly, RoadMain T 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 RoadMain T will offset losses from the drop in RoadMain T's long position.| Gome Telecom vs. China State Construction | Gome Telecom vs. China Merchants Shekou | Gome Telecom vs. Huafa Industrial Co | Gome Telecom vs. China International Capital |
| RoadMain T vs. Cultural Investment Holdings | RoadMain T vs. Gome Telecom Equipment | RoadMain T vs. Bus Online Co | RoadMain T 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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