Correlation Between Industrial and Gome Telecom
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By analyzing existing cross correlation between Industrial and Commercial and Gome Telecom Equipment, you can compare the effects of market volatilities on Industrial and Gome Telecom 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 Industrial with a short position of Gome Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Gome Telecom.
Diversification Opportunities for Industrial and Gome Telecom
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Industrial and Gome is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Gome Telecom Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gome Telecom Equipment and Industrial 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 Industrial and Commercial are associated (or correlated) with Gome Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gome Telecom Equipment has no effect on the direction of Industrial i.e., Industrial and Gome Telecom go up and down completely randomly.
Pair Corralation between Industrial and Gome Telecom
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.34 times more return on investment than Gome Telecom. However, Industrial and Commercial is 2.97 times less risky than Gome Telecom. It trades about 0.09 of its potential returns per unit of risk. Gome Telecom Equipment is currently generating about -0.04 per unit of risk. If you would invest 471.00 in Industrial and Commercial on September 1, 2024 and sell it today you would earn a total of 144.00 from holding Industrial and Commercial or generate 30.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Gome Telecom Equipment
Performance |
| Timeline |
| Industrial and Commercial |
| Gome Telecom Equipment |
Industrial and Gome Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Gome Telecom
The main advantage of trading using opposite Industrial and Gome Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Gome Telecom 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 Gome Telecom will offset losses from the drop in Gome Telecom's long position.| Industrial vs. Fiberhome Telecommunication Technologies | Industrial vs. Chengdu Spaceon Electronics | Industrial vs. Zhongtong Guomai Communication | Industrial vs. Railway Signal Communication |
| Gome Telecom vs. Broadex Technologies Co | Gome Telecom vs. Changchun Engley Automobile | Gome Telecom vs. Anhui Jianghuai Automobile | Gome Telecom vs. Chongqing Changan Automobile |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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