Correlation Between Sichuan Hebang and Guangzhou Seagull
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By analyzing existing cross correlation between Sichuan Hebang Biotechnology and Guangzhou Seagull Kitchen, you can compare the effects of market volatilities on Sichuan Hebang and Guangzhou Seagull 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 Sichuan Hebang with a short position of Guangzhou Seagull. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Hebang and Guangzhou Seagull.
Diversification Opportunities for Sichuan Hebang and Guangzhou Seagull
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sichuan and Guangzhou is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Hebang Biotechnology and Guangzhou Seagull Kitchen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Seagull Kitchen and Sichuan Hebang 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 Sichuan Hebang Biotechnology are associated (or correlated) with Guangzhou Seagull. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Seagull Kitchen has no effect on the direction of Sichuan Hebang i.e., Sichuan Hebang and Guangzhou Seagull go up and down completely randomly.
Pair Corralation between Sichuan Hebang and Guangzhou Seagull
Assuming the 90 days trading horizon Sichuan Hebang Biotechnology is expected to generate 0.35 times more return on investment than Guangzhou Seagull. However, Sichuan Hebang Biotechnology is 2.83 times less risky than Guangzhou Seagull. It trades about -0.65 of its potential returns per unit of risk. Guangzhou Seagull Kitchen is currently generating about -0.27 per unit of risk. If you would invest 229.00 in Sichuan Hebang Biotechnology on October 14, 2024 and sell it today you would lose (41.00) from holding Sichuan Hebang Biotechnology or give up 17.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Hebang Biotechnology vs. Guangzhou Seagull Kitchen
Performance |
| Timeline |
| Sichuan Hebang Biote |
| Guangzhou Seagull Kitchen |
Sichuan Hebang and Guangzhou Seagull Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Hebang and Guangzhou Seagull
The main advantage of trading using opposite Sichuan Hebang and Guangzhou Seagull positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Hebang position performs unexpectedly, Guangzhou Seagull 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 Seagull will offset losses from the drop in Guangzhou Seagull's long position.| Sichuan Hebang vs. Namchow Food Group | Sichuan Hebang vs. Fiberhome Telecommunication Technologies | Sichuan Hebang vs. V V Food | Sichuan Hebang vs. Xinjiang Tianrun Dairy |
| Guangzhou Seagull vs. Jilin Chemical Fibre | Guangzhou Seagull vs. Sichuan Hebang Biotechnology | Guangzhou Seagull vs. Changchun BCHT Biotechnology | Guangzhou Seagull vs. Dymatic Chemicals |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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