Correlation Between Guangzhou Restaurants and Guangzhou Jointas
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By analyzing existing cross correlation between Guangzhou Restaurants Group and Guangzhou Jointas Chemical, you can compare the effects of market volatilities on Guangzhou Restaurants and Guangzhou Jointas 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 Guangzhou Jointas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Restaurants and Guangzhou Jointas.
Diversification Opportunities for Guangzhou Restaurants and Guangzhou Jointas
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Guangzhou is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Restaurants Group and Guangzhou Jointas Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Jointas 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 Guangzhou Jointas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Jointas has no effect on the direction of Guangzhou Restaurants i.e., Guangzhou Restaurants and Guangzhou Jointas go up and down completely randomly.
Pair Corralation between Guangzhou Restaurants and Guangzhou Jointas
Assuming the 90 days trading horizon Guangzhou Restaurants Group is expected to under-perform the Guangzhou Jointas. But the stock apears to be less risky and, when comparing its historical volatility, Guangzhou Restaurants Group is 1.44 times less risky than Guangzhou Jointas. The stock trades about -0.05 of its potential returns per unit of risk. The Guangzhou Jointas Chemical is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 796.00 in Guangzhou Jointas Chemical on September 12, 2024 and sell it today you would lose (199.00) from holding Guangzhou Jointas Chemical or give up 25.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Restaurants Group vs. Guangzhou Jointas Chemical
Performance |
| Timeline |
| Guangzhou Restaurants |
| Guangzhou Jointas |
Guangzhou Restaurants and Guangzhou Jointas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Restaurants and Guangzhou Jointas
The main advantage of trading using opposite Guangzhou Restaurants and Guangzhou Jointas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Restaurants position performs unexpectedly, Guangzhou Jointas 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 Jointas will offset losses from the drop in Guangzhou Jointas' long position.| Guangzhou Restaurants vs. Lutian Machinery Co | Guangzhou Restaurants vs. PetroChina Co Ltd | Guangzhou Restaurants vs. Bank of China | Guangzhou Restaurants vs. Gansu Jiu Steel |
| Guangzhou Jointas vs. Zijin Mining Group | Guangzhou Jointas vs. Wanhua Chemical Group | Guangzhou Jointas vs. Baoshan Iron Steel | Guangzhou Jointas vs. Rongsheng Petrochemical 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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