Correlation Between Heilongjiang Transport and Guosheng Financial
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By analyzing existing cross correlation between Heilongjiang Transport Development and Guosheng Financial Holding, you can compare the effects of market volatilities on Heilongjiang Transport and Guosheng Financial 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 Heilongjiang Transport with a short position of Guosheng Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Transport and Guosheng Financial.
Diversification Opportunities for Heilongjiang Transport and Guosheng Financial
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Heilongjiang and Guosheng is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Transport Develop and Guosheng Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guosheng Financial and Heilongjiang Transport 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 Heilongjiang Transport Development are associated (or correlated) with Guosheng Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guosheng Financial has no effect on the direction of Heilongjiang Transport i.e., Heilongjiang Transport and Guosheng Financial go up and down completely randomly.
Pair Corralation between Heilongjiang Transport and Guosheng Financial
Assuming the 90 days trading horizon Heilongjiang Transport is expected to generate 1.75 times less return on investment than Guosheng Financial. But when comparing it to its historical volatility, Heilongjiang Transport Development is 2.23 times less risky than Guosheng Financial. It trades about 0.18 of its potential returns per unit of risk. Guosheng Financial Holding is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,162 in Guosheng Financial Holding on September 5, 2024 and sell it today you would earn a total of 128.00 from holding Guosheng Financial Holding or generate 11.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heilongjiang Transport Develop vs. Guosheng Financial Holding
Performance |
| Timeline |
| Heilongjiang Transport |
| Guosheng Financial |
Heilongjiang Transport and Guosheng Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heilongjiang Transport and Guosheng Financial
The main advantage of trading using opposite Heilongjiang Transport and Guosheng Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Transport position performs unexpectedly, Guosheng Financial 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 Guosheng Financial will offset losses from the drop in Guosheng Financial's long position.| Heilongjiang Transport vs. China Life Insurance | Heilongjiang Transport vs. Cinda Securities Co | Heilongjiang Transport vs. Piotech Inc A | Heilongjiang Transport vs. Dongxing Sec Co |
| Guosheng Financial vs. Xinke Material | Guosheng Financial vs. Fuda Alloy Materials | Guosheng Financial vs. Shenzhen SDG Information | Guosheng Financial vs. Yonyou Auto Information |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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