Correlation Between Peoples Insurance and Guangzhou Restaurants
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By analyzing existing cross correlation between Peoples Insurance of and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Peoples Insurance and Guangzhou Restaurants 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 Peoples Insurance with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Guangzhou Restaurants.
Diversification Opportunities for Peoples Insurance and Guangzhou Restaurants
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Peoples and Guangzhou is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Insurance of and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Peoples Insurance 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 Peoples Insurance of are associated (or correlated) with Guangzhou Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Restaurants has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Peoples Insurance and Guangzhou Restaurants
Assuming the 90 days trading horizon Peoples Insurance is expected to generate 5.36 times less return on investment than Guangzhou Restaurants. In addition to that, Peoples Insurance is 1.27 times more volatile than Guangzhou Restaurants Group. It trades about 0.02 of its total potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about 0.11 per unit of volatility. If you would invest 1,553 in Guangzhou Restaurants Group on August 30, 2024 and sell it today you would earn a total of 67.00 from holding Guangzhou Restaurants Group or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peoples Insurance of vs. Guangzhou Restaurants Group
Performance |
| Timeline |
| Peoples Insurance |
| Guangzhou Restaurants |
Peoples Insurance and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Insurance and Guangzhou Restaurants
The main advantage of trading using opposite Peoples Insurance and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Guangzhou Restaurants 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 Guangzhou Restaurants will offset losses from the drop in Guangzhou Restaurants' long position.| Peoples Insurance vs. Ming Yang Smart | Peoples Insurance vs. 159005 | Peoples Insurance vs. Loctek Ergonomic Technology | Peoples Insurance vs. 516220 |
| Guangzhou Restaurants vs. China Petroleum Chemical | Guangzhou Restaurants vs. PetroChina Co Ltd | Guangzhou Restaurants vs. China State Construction | Guangzhou Restaurants vs. China Railway Group |
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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