Correlation Between Guangdong Liantai and Beijing SPC
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By analyzing existing cross correlation between Guangdong Liantai Environmental and Beijing SPC Environment, you can compare the effects of market volatilities on Guangdong Liantai and Beijing SPC 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 Liantai with a short position of Beijing SPC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Liantai and Beijing SPC.
Diversification Opportunities for Guangdong Liantai and Beijing SPC
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Beijing is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Liantai Environmenta and Beijing SPC Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing SPC Environment and Guangdong Liantai 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 Liantai Environmental are associated (or correlated) with Beijing SPC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing SPC Environment has no effect on the direction of Guangdong Liantai i.e., Guangdong Liantai and Beijing SPC go up and down completely randomly.
Pair Corralation between Guangdong Liantai and Beijing SPC
Assuming the 90 days trading horizon Guangdong Liantai Environmental is expected to generate 1.35 times more return on investment than Beijing SPC. However, Guangdong Liantai is 1.35 times more volatile than Beijing SPC Environment. It trades about 0.13 of its potential returns per unit of risk. Beijing SPC Environment is currently generating about -0.08 per unit of risk. If you would invest 389.00 in Guangdong Liantai Environmental on August 28, 2024 and sell it today you would earn a total of 24.00 from holding Guangdong Liantai Environmental or generate 6.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Liantai Environmenta vs. Beijing SPC Environment
Performance |
| Timeline |
| Guangdong Liantai |
| Beijing SPC Environment |
Guangdong Liantai and Beijing SPC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Liantai and Beijing SPC
The main advantage of trading using opposite Guangdong Liantai and Beijing SPC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Liantai position performs unexpectedly, Beijing SPC 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 Beijing SPC will offset losses from the drop in Beijing SPC's long position.| Guangdong Liantai vs. Jiamei Food Packaging | Guangdong Liantai vs. Chahua Modern Housewares | Guangdong Liantai vs. Vanfund Urban Investment | Guangdong Liantai vs. Jahen Household Products |
| Beijing SPC vs. Central Plains Environment | Beijing SPC vs. Guangdong Liantai Environmental | Beijing SPC vs. GRINM Semiconductor Materials | Beijing SPC vs. Southchip Semiconductor Technology |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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