Correlation Between Hainan Haiqi and Guangzhou Automobile
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By analyzing existing cross correlation between Hainan Haiqi Transportation and Guangzhou Automobile Group, you can compare the effects of market volatilities on Hainan Haiqi and Guangzhou Automobile 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 Hainan Haiqi with a short position of Guangzhou Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Haiqi and Guangzhou Automobile.
Diversification Opportunities for Hainan Haiqi and Guangzhou Automobile
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hainan and Guangzhou is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Haiqi Transportation and Guangzhou Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Automobile and Hainan Haiqi 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 Hainan Haiqi Transportation are associated (or correlated) with Guangzhou Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Automobile has no effect on the direction of Hainan Haiqi i.e., Hainan Haiqi and Guangzhou Automobile go up and down completely randomly.
Pair Corralation between Hainan Haiqi and Guangzhou Automobile
Assuming the 90 days trading horizon Hainan Haiqi Transportation is expected to under-perform the Guangzhou Automobile. In addition to that, Hainan Haiqi is 1.65 times more volatile than Guangzhou Automobile Group. It trades about -0.01 of its total potential returns per unit of risk. Guangzhou Automobile Group is currently generating about -0.01 per unit of volatility. If you would invest 1,117 in Guangzhou Automobile Group on September 14, 2024 and sell it today you would lose (131.00) from holding Guangzhou Automobile Group or give up 11.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Haiqi Transportation vs. Guangzhou Automobile Group
Performance |
| Timeline |
| Hainan Haiqi Transpo |
| Guangzhou Automobile |
Hainan Haiqi and Guangzhou Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Haiqi and Guangzhou Automobile
The main advantage of trading using opposite Hainan Haiqi and Guangzhou Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Haiqi position performs unexpectedly, Guangzhou Automobile 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 Automobile will offset losses from the drop in Guangzhou Automobile's long position.| Hainan Haiqi vs. Ming Yang Smart | Hainan Haiqi vs. 159681 | Hainan Haiqi vs. 159005 | Hainan Haiqi vs. Loctek Ergonomic Technology |
| Guangzhou Automobile vs. Henan Shuanghui Investment | Guangzhou Automobile vs. Hunan Investment Group | Guangzhou Automobile vs. Kunwu Jiuding Investment | Guangzhou Automobile vs. Harvest Fund 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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