Correlation Between China Railway and Guangdong Marubi
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By analyzing existing cross correlation between China Railway Group and Guangdong Marubi Biotechnology, you can compare the effects of market volatilities on China Railway and Guangdong Marubi 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 China Railway with a short position of Guangdong Marubi. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Guangdong Marubi.
Diversification Opportunities for China Railway and Guangdong Marubi
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Guangdong is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Guangdong Marubi Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Marubi Bio and China Railway 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 China Railway Group are associated (or correlated) with Guangdong Marubi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Marubi Bio has no effect on the direction of China Railway i.e., China Railway and Guangdong Marubi go up and down completely randomly.
Pair Corralation between China Railway and Guangdong Marubi
Assuming the 90 days trading horizon China Railway Group is expected to generate 0.89 times more return on investment than Guangdong Marubi. However, China Railway Group is 1.13 times less risky than Guangdong Marubi. It trades about 0.03 of its potential returns per unit of risk. Guangdong Marubi Biotechnology is currently generating about 0.01 per unit of risk. If you would invest 544.00 in China Railway Group on September 12, 2024 and sell it today you would earn a total of 115.00 from holding China Railway Group or generate 21.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Guangdong Marubi Biotechnology
Performance |
| Timeline |
| China Railway Group |
| Guangdong Marubi Bio |
China Railway and Guangdong Marubi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Guangdong Marubi
The main advantage of trading using opposite China Railway and Guangdong Marubi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Guangdong Marubi 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 Guangdong Marubi will offset losses from the drop in Guangdong Marubi's long position.| China Railway vs. Changchun BCHT Biotechnology | China Railway vs. Ningbo MedicalSystem Biotechnology | China Railway vs. Lander Sports Development | China Railway vs. Heilongjiang Publishing Media |
| Guangdong Marubi vs. China Petroleum Chemical | Guangdong Marubi vs. PetroChina Co Ltd | Guangdong Marubi vs. China State Construction | Guangdong Marubi 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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