Correlation Between Guangdong Liantai and Zhejiang Yayi
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By analyzing existing cross correlation between Guangdong Liantai Environmental and Zhejiang Yayi Metal, you can compare the effects of market volatilities on Guangdong Liantai and Zhejiang Yayi 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 Zhejiang Yayi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Liantai and Zhejiang Yayi.
Diversification Opportunities for Guangdong Liantai and Zhejiang Yayi
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Zhejiang is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Liantai Environmenta and Zhejiang Yayi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yayi Metal 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 Zhejiang Yayi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yayi Metal has no effect on the direction of Guangdong Liantai i.e., Guangdong Liantai and Zhejiang Yayi go up and down completely randomly.
Pair Corralation between Guangdong Liantai and Zhejiang Yayi
Assuming the 90 days trading horizon Guangdong Liantai Environmental is expected to under-perform the Zhejiang Yayi. But the stock apears to be less risky and, when comparing its historical volatility, Guangdong Liantai Environmental is 1.52 times less risky than Zhejiang Yayi. The stock trades about -0.03 of its potential returns per unit of risk. The Zhejiang Yayi Metal is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 3,196 in Zhejiang Yayi Metal on September 2, 2024 and sell it today you would lose (523.00) from holding Zhejiang Yayi Metal or give up 16.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Liantai Environmenta vs. Zhejiang Yayi Metal
Performance |
| Timeline |
| Guangdong Liantai |
| Zhejiang Yayi Metal |
Guangdong Liantai and Zhejiang Yayi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Liantai and Zhejiang Yayi
The main advantage of trading using opposite Guangdong Liantai and Zhejiang Yayi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Liantai position performs unexpectedly, Zhejiang Yayi 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 Zhejiang Yayi will offset losses from the drop in Zhejiang Yayi's long position.| Guangdong Liantai vs. Anhui Deli Household | Guangdong Liantai vs. Guangzhou Restaurants Group | Guangdong Liantai vs. Zhangjiagang Freetrade Science | Guangdong Liantai vs. Hua Xia Bank |
| Zhejiang Yayi vs. Zoje Resources Investment | Zhejiang Yayi vs. Luyin Investment Group | Zhejiang Yayi vs. Hefei Metalforming Mach | Zhejiang Yayi vs. Shanghai Material Trading |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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