Correlation Between Guangzhou Restaurants and Advanced Technology
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By analyzing existing cross correlation between Guangzhou Restaurants Group and Advanced Technology Materials, you can compare the effects of market volatilities on Guangzhou Restaurants and Advanced Technology 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 Advanced Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Restaurants and Advanced Technology.
Diversification Opportunities for Guangzhou Restaurants and Advanced Technology
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangzhou and Advanced is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Restaurants Group and Advanced Technology Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Technology 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 Advanced Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Technology has no effect on the direction of Guangzhou Restaurants i.e., Guangzhou Restaurants and Advanced Technology go up and down completely randomly.
Pair Corralation between Guangzhou Restaurants and Advanced Technology
Assuming the 90 days trading horizon Guangzhou Restaurants Group is expected to under-perform the Advanced Technology. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Restaurants Group is 1.69 times less risky than Advanced Technology. The stock trades about -0.42 of its potential returns per unit of risk. The Advanced Technology Materials is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,146 in Advanced Technology Materials on October 17, 2024 and sell it today you would earn a total of 18.00 from holding Advanced Technology Materials or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Restaurants Group vs. Advanced Technology Materials
Performance |
| Timeline |
| Guangzhou Restaurants |
| Advanced Technology |
Guangzhou Restaurants and Advanced Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Restaurants and Advanced Technology
The main advantage of trading using opposite Guangzhou Restaurants and Advanced Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Restaurants position performs unexpectedly, Advanced Technology 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 Advanced Technology will offset losses from the drop in Advanced Technology's long position.| Guangzhou Restaurants vs. Advanced Technology Materials | Guangzhou Restaurants vs. Jiangnan Mould Plastic | Guangzhou Restaurants vs. JuneYao Dairy Co | Guangzhou Restaurants vs. Guangzhou Tinci Materials |
| Advanced Technology vs. JCHX Mining Management | Advanced Technology vs. AVIC Fund Management | Advanced Technology vs. Heilongjiang Publishing Media | Advanced Technology vs. Sanbo Hospital Management |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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