Correlation Between Bank of Changsha and Guangzhou Ruoyuchen
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By analyzing existing cross correlation between Bank of Changsha and Guangzhou Ruoyuchen Information, you can compare the effects of market volatilities on Bank of Changsha and Guangzhou Ruoyuchen 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 Bank of Changsha with a short position of Guangzhou Ruoyuchen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of Changsha and Guangzhou Ruoyuchen.
Diversification Opportunities for Bank of Changsha and Guangzhou Ruoyuchen
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bank and Guangzhou is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Bank of Changsha and Guangzhou Ruoyuchen Informatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Ruoyuchen and Bank of Changsha 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 Bank of Changsha are associated (or correlated) with Guangzhou Ruoyuchen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Ruoyuchen has no effect on the direction of Bank of Changsha i.e., Bank of Changsha and Guangzhou Ruoyuchen go up and down completely randomly.
Pair Corralation between Bank of Changsha and Guangzhou Ruoyuchen
Assuming the 90 days trading horizon Bank of Changsha is expected to under-perform the Guangzhou Ruoyuchen. But the stock apears to be less risky and, when comparing its historical volatility, Bank of Changsha is 4.16 times less risky than Guangzhou Ruoyuchen. The stock trades about -0.13 of its potential returns per unit of risk. The Guangzhou Ruoyuchen Information is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 2,213 in Guangzhou Ruoyuchen Information on October 9, 2024 and sell it today you would earn a total of 379.00 from holding Guangzhou Ruoyuchen Information or generate 17.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of Changsha vs. Guangzhou Ruoyuchen Informatio
Performance |
| Timeline |
| Bank of Changsha |
| Guangzhou Ruoyuchen |
Bank of Changsha and Guangzhou Ruoyuchen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of Changsha and Guangzhou Ruoyuchen
The main advantage of trading using opposite Bank of Changsha and Guangzhou Ruoyuchen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of Changsha position performs unexpectedly, Guangzhou Ruoyuchen 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 Ruoyuchen will offset losses from the drop in Guangzhou Ruoyuchen's long position.| Bank of Changsha vs. Industrial and Commercial | Bank of Changsha vs. China Construction Bank | Bank of Changsha vs. Agricultural Bank of | Bank of Changsha vs. Bank of China |
| Guangzhou Ruoyuchen vs. China Life Insurance | Guangzhou Ruoyuchen vs. Cinda Securities Co | Guangzhou Ruoyuchen vs. Piotech Inc A | Guangzhou Ruoyuchen vs. Dongxing Sec 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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