Correlation Between New China and Gansu Yasheng
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By analyzing existing cross correlation between New China Life and Gansu Yasheng Industrial, you can compare the effects of market volatilities on New China and Gansu Yasheng 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 New China with a short position of Gansu Yasheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of New China and Gansu Yasheng.
Diversification Opportunities for New China and Gansu Yasheng
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between New and Gansu is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding New China Life and Gansu Yasheng Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Yasheng Industrial and New China 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 New China Life are associated (or correlated) with Gansu Yasheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Yasheng Industrial has no effect on the direction of New China i.e., New China and Gansu Yasheng go up and down completely randomly.
Pair Corralation between New China and Gansu Yasheng
Assuming the 90 days trading horizon New China Life is expected to generate 1.44 times more return on investment than Gansu Yasheng. However, New China is 1.44 times more volatile than Gansu Yasheng Industrial. It trades about 0.06 of its potential returns per unit of risk. Gansu Yasheng Industrial is currently generating about -0.01 per unit of risk. If you would invest 2,900 in New China Life on December 4, 2024 and sell it today you would earn a total of 1,867 from holding New China Life or generate 64.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
New China Life vs. Gansu Yasheng Industrial
Performance |
| Timeline |
| New China Life |
| Gansu Yasheng Industrial |
New China and Gansu Yasheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with New China and Gansu Yasheng
The main advantage of trading using opposite New China and Gansu Yasheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New China position performs unexpectedly, Gansu Yasheng 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 Gansu Yasheng will offset losses from the drop in Gansu Yasheng's long position.| New China vs. Fsilon Furnishing and | New China vs. Guangzhou Haozhi Industrial | New China vs. Bosera CMSK Industrial | New China vs. Shenzhen Zhongzhuang Construction |
| Gansu Yasheng vs. Jinhui Mining Co | Gansu Yasheng vs. Gansu Huangtai Wine marketing | Gansu Yasheng vs. Levima Advanced Materials | Gansu Yasheng vs. Hainan Mining 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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