Correlation Between Industrial and Guangdong Skychem
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By analyzing existing cross correlation between Industrial and Commercial and Guangdong Skychem Technology, you can compare the effects of market volatilities on Industrial and Guangdong Skychem 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 Guangdong Skychem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Guangdong Skychem.
Diversification Opportunities for Industrial and Guangdong Skychem
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Industrial and Guangdong is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Guangdong Skychem Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Skychem 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 Guangdong Skychem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Skychem has no effect on the direction of Industrial i.e., Industrial and Guangdong Skychem go up and down completely randomly.
Pair Corralation between Industrial and Guangdong Skychem
Assuming the 90 days trading horizon Industrial is expected to generate 1.81 times less return on investment than Guangdong Skychem. But when comparing it to its historical volatility, Industrial and Commercial is 3.62 times less risky than Guangdong Skychem. It trades about 0.09 of its potential returns per unit of risk. Guangdong Skychem Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5,452 in Guangdong Skychem Technology on October 15, 2024 and sell it today you would earn a total of 2,712 from holding Guangdong Skychem Technology or generate 49.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 77.62% |
| Values | Daily Returns |
Industrial and Commercial vs. Guangdong Skychem Technology
Performance |
| Timeline |
| Industrial and Commercial |
| Guangdong Skychem |
Industrial and Guangdong Skychem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Guangdong Skychem
The main advantage of trading using opposite Industrial and Guangdong Skychem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Guangdong Skychem 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 Skychem will offset losses from the drop in Guangdong Skychem's long position.| Industrial vs. East Money Information | Industrial vs. Marssenger Kitchenware Co | Industrial vs. Guangzhou Ruoyuchen Information | Industrial vs. Sublime China Information |
| Guangdong Skychem vs. Kunwu Jiuding Investment | Guangdong Skychem vs. Xiandai Investment Co | Guangdong Skychem vs. Hubei Geoway Investment | Guangdong Skychem vs. Henan Shuanghui Investment |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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