Correlation Between Guangdong Ellington and Jiangsu Hoperun
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By analyzing existing cross correlation between Guangdong Ellington Electronics and Jiangsu Hoperun Software, you can compare the effects of market volatilities on Guangdong Ellington and Jiangsu Hoperun 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 Guangdong Ellington with a short position of Jiangsu Hoperun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Ellington and Jiangsu Hoperun.
Diversification Opportunities for Guangdong Ellington and Jiangsu Hoperun
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Guangdong and Jiangsu is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Ellington Electronic and Jiangsu Hoperun Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Hoperun Software and Guangdong Ellington 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 Guangdong Ellington Electronics are associated (or correlated) with Jiangsu Hoperun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Hoperun Software has no effect on the direction of Guangdong Ellington i.e., Guangdong Ellington and Jiangsu Hoperun go up and down completely randomly.
Pair Corralation between Guangdong Ellington and Jiangsu Hoperun
Assuming the 90 days trading horizon Guangdong Ellington Electronics is expected to generate 0.73 times more return on investment than Jiangsu Hoperun. However, Guangdong Ellington Electronics is 1.36 times less risky than Jiangsu Hoperun. It trades about 0.29 of its potential returns per unit of risk. Jiangsu Hoperun Software is currently generating about 0.14 per unit of risk. If you would invest 887.00 in Guangdong Ellington Electronics on November 7, 2024 and sell it today you would earn a total of 129.00 from holding Guangdong Ellington Electronics or generate 14.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Ellington Electronic vs. Jiangsu Hoperun Software
Performance |
| Timeline |
| Guangdong Ellington |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Jiangsu Hoperun Software |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Guangdong Ellington and Jiangsu Hoperun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Ellington and Jiangsu Hoperun
The main advantage of trading using opposite Guangdong Ellington and Jiangsu Hoperun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Ellington position performs unexpectedly, Jiangsu Hoperun 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 Jiangsu Hoperun will offset losses from the drop in Jiangsu Hoperun's long position.The idea behind Guangdong Ellington Electronics and Jiangsu Hoperun Software pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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