Correlation Between Guangzhou Automobile and Huaibei Mining
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By analyzing existing cross correlation between Guangzhou Automobile Group and Huaibei Mining Holdings, you can compare the effects of market volatilities on Guangzhou Automobile and Huaibei Mining 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 Huaibei Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Automobile and Huaibei Mining.
Diversification Opportunities for Guangzhou Automobile and Huaibei Mining
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Guangzhou and Huaibei is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Automobile Group and Huaibei Mining Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huaibei Mining Holdings 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 Huaibei Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huaibei Mining Holdings has no effect on the direction of Guangzhou Automobile i.e., Guangzhou Automobile and Huaibei Mining go up and down completely randomly.
Pair Corralation between Guangzhou Automobile and Huaibei Mining
Assuming the 90 days trading horizon Guangzhou Automobile Group is expected to generate 1.13 times more return on investment than Huaibei Mining. However, Guangzhou Automobile is 1.13 times more volatile than Huaibei Mining Holdings. It trades about 0.05 of its potential returns per unit of risk. Huaibei Mining Holdings is currently generating about 0.01 per unit of risk. If you would invest 774.00 in Guangzhou Automobile Group on November 3, 2024 and sell it today you would earn a total of 86.00 from holding Guangzhou Automobile Group or generate 11.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Automobile Group vs. Huaibei Mining Holdings
Performance |
| Timeline |
| Guangzhou Automobile |
| Huaibei Mining Holdings |
Guangzhou Automobile and Huaibei Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Automobile and Huaibei Mining
The main advantage of trading using opposite Guangzhou Automobile and Huaibei Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Automobile position performs unexpectedly, Huaibei Mining 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 Huaibei Mining will offset losses from the drop in Huaibei Mining's long position.| Guangzhou Automobile vs. China National Software | Guangzhou Automobile vs. Linkage Software Co | Guangzhou Automobile vs. Glodon Software Co | Guangzhou Automobile vs. Daoming OpticsChemical Co |
| Huaibei Mining vs. Nantong Haixing Electronics | Huaibei Mining vs. Olympic Circuit Technology | Huaibei Mining vs. Dhc Software Co | Huaibei Mining vs. Montage 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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