Correlation Between Guangzhou Automobile and Dongrui Food
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By analyzing existing cross correlation between Guangzhou Automobile Group and Dongrui Food Group, you can compare the effects of market volatilities on Guangzhou Automobile and Dongrui Food 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 Guangzhou Automobile with a short position of Dongrui Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Automobile and Dongrui Food.
Diversification Opportunities for Guangzhou Automobile and Dongrui Food
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Guangzhou and Dongrui is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Automobile Group and Dongrui Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongrui Food Group and Guangzhou Automobile 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 Guangzhou Automobile Group are associated (or correlated) with Dongrui Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongrui Food Group has no effect on the direction of Guangzhou Automobile i.e., Guangzhou Automobile and Dongrui Food go up and down completely randomly.
Pair Corralation between Guangzhou Automobile and Dongrui Food
Assuming the 90 days trading horizon Guangzhou Automobile Group is expected to under-perform the Dongrui Food. In addition to that, Guangzhou Automobile is 1.24 times more volatile than Dongrui Food Group. It trades about -0.18 of its total potential returns per unit of risk. Dongrui Food Group is currently generating about -0.12 per unit of volatility. If you would invest 1,518 in Dongrui Food Group on October 25, 2024 and sell it today you would lose (77.00) from holding Dongrui Food Group or give up 5.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Automobile Group vs. Dongrui Food Group
Performance |
| Timeline |
| Guangzhou Automobile |
| Dongrui Food Group |
Guangzhou Automobile and Dongrui Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Automobile and Dongrui Food
The main advantage of trading using opposite Guangzhou Automobile and Dongrui Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Automobile position performs unexpectedly, Dongrui Food 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 Dongrui Food will offset losses from the drop in Dongrui Food's long position.| Guangzhou Automobile vs. PetroChina Co Ltd | Guangzhou Automobile vs. Gansu Jiu Steel | Guangzhou Automobile vs. Ming Yang Smart | Guangzhou Automobile vs. Aba Chemicals Corp |
| Dongrui Food vs. Agricultural Bank of | Dongrui Food vs. Postal Savings Bank | Dongrui Food vs. Bank of Communications | Dongrui Food vs. China Merchants Bank |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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