Correlation Between Bank of China and Goke Microelectronics
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By analyzing existing cross correlation between Bank of China and Goke Microelectronics Co, you can compare the effects of market volatilities on Bank of China and Goke Microelectronics 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 China with a short position of Goke Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bank of China and Goke Microelectronics.
Diversification Opportunities for Bank of China and Goke Microelectronics
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bank and Goke is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Bank of China and Goke Microelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goke Microelectronics and Bank of 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 Bank of China are associated (or correlated) with Goke Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goke Microelectronics has no effect on the direction of Bank of China i.e., Bank of China and Goke Microelectronics go up and down completely randomly.
Pair Corralation between Bank of China and Goke Microelectronics
Assuming the 90 days trading horizon Bank of China is expected to generate 0.33 times more return on investment than Goke Microelectronics. However, Bank of China is 2.99 times less risky than Goke Microelectronics. It trades about 0.15 of its potential returns per unit of risk. Goke Microelectronics Co is currently generating about -0.11 per unit of risk. If you would invest 526.00 in Bank of China on October 17, 2024 and sell it today you would earn a total of 19.00 from holding Bank of China or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bank of China vs. Goke Microelectronics Co
Performance |
| Timeline |
| Bank of China |
| Goke Microelectronics |
Bank of China and Goke Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bank of China and Goke Microelectronics
The main advantage of trading using opposite Bank of China and Goke Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bank of China position performs unexpectedly, Goke Microelectronics 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 Goke Microelectronics will offset losses from the drop in Goke Microelectronics' long position.| Bank of China vs. Ningbo Fangzheng Automobile | Bank of China vs. Anhui Xinhua Media | Bank of China vs. Shuhua Sports Co | Bank of China vs. Heilongjiang Publishing Media |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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