Correlation Between Guangdong Liantai and Guosheng Financial
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By analyzing existing cross correlation between Guangdong Liantai Environmental and Guosheng Financial Holding, you can compare the effects of market volatilities on Guangdong Liantai and Guosheng Financial 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 Guosheng Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Liantai and Guosheng Financial.
Diversification Opportunities for Guangdong Liantai and Guosheng Financial
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and Guosheng is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Liantai Environmenta and Guosheng Financial Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guosheng Financial 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 Guosheng Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guosheng Financial has no effect on the direction of Guangdong Liantai i.e., Guangdong Liantai and Guosheng Financial go up and down completely randomly.
Pair Corralation between Guangdong Liantai and Guosheng Financial
Assuming the 90 days trading horizon Guangdong Liantai Environmental is expected to generate 0.51 times more return on investment than Guosheng Financial. However, Guangdong Liantai Environmental is 1.95 times less risky than Guosheng Financial. It trades about -0.31 of its potential returns per unit of risk. Guosheng Financial Holding is currently generating about -0.28 per unit of risk. If you would invest 450.00 in Guangdong Liantai Environmental on October 17, 2024 and sell it today you would lose (62.00) from holding Guangdong Liantai Environmental or give up 13.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Liantai Environmenta vs. Guosheng Financial Holding
Performance |
| Timeline |
| Guangdong Liantai |
| Guosheng Financial |
Guangdong Liantai and Guosheng Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Liantai and Guosheng Financial
The main advantage of trading using opposite Guangdong Liantai and Guosheng Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Liantai position performs unexpectedly, Guosheng Financial 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 Guosheng Financial will offset losses from the drop in Guosheng Financial's long position.| Guangdong Liantai vs. MayAir Technology Co | Guangdong Liantai vs. Cultural Investment Holdings | Guangdong Liantai vs. Iat Automobile Technology | Guangdong Liantai vs. Guangzhou KingTeller Technology |
| Guosheng Financial vs. Tibet Huayu Mining | Guosheng Financial vs. Rising Nonferrous Metals | Guosheng Financial vs. Guangdong Jingyi Metal | Guosheng Financial vs. Wonders Information |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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