Correlation Between Guangzhou Restaurants and Changchun High
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By analyzing existing cross correlation between Guangzhou Restaurants Group and Changchun High New, you can compare the effects of market volatilities on Guangzhou Restaurants and Changchun High 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 Guangzhou Restaurants with a short position of Changchun High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Restaurants and Changchun High.
Diversification Opportunities for Guangzhou Restaurants and Changchun High
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Changchun is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Restaurants Group and Changchun High New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun High New and Guangzhou Restaurants 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 Guangzhou Restaurants Group are associated (or correlated) with Changchun High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun High New has no effect on the direction of Guangzhou Restaurants i.e., Guangzhou Restaurants and Changchun High go up and down completely randomly.
Pair Corralation between Guangzhou Restaurants and Changchun High
Assuming the 90 days trading horizon Guangzhou Restaurants Group is expected to under-perform the Changchun High. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Restaurants Group is 1.25 times less risky than Changchun High. The stock trades about -0.03 of its potential returns per unit of risk. The Changchun High New is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 11,825 in Changchun High New on September 3, 2024 and sell it today you would lose (1,103) from holding Changchun High New or give up 9.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Restaurants Group vs. Changchun High New
Performance |
| Timeline |
| Guangzhou Restaurants |
| Changchun High New |
Guangzhou Restaurants and Changchun High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Restaurants and Changchun High
The main advantage of trading using opposite Guangzhou Restaurants and Changchun High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Restaurants position performs unexpectedly, Changchun High 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 Changchun High will offset losses from the drop in Changchun High's long position.| Guangzhou Restaurants vs. PetroChina Co Ltd | Guangzhou Restaurants vs. China Mobile Limited | Guangzhou Restaurants vs. Industrial and Commercial | Guangzhou Restaurants vs. China Life Insurance |
| Changchun High vs. Guangzhou Restaurants Group | Changchun High vs. Suzhou Douson Drilling | Changchun High vs. Beijing Sanyuan Foods | Changchun High vs. Kingsignal Technology 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 CEOs Directory module to screen CEOs from public companies around the world.
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