Correlation Between Guangdong Marubi and China Southern
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By analyzing existing cross correlation between Guangdong Marubi Biotechnology and China Southern Airlines, you can compare the effects of market volatilities on Guangdong Marubi and China Southern 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 Marubi with a short position of China Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Marubi and China Southern.
Diversification Opportunities for Guangdong Marubi and China Southern
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and China is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Marubi Biotechnology and China Southern Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern Airlines and Guangdong Marubi 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 Marubi Biotechnology are associated (or correlated) with China Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern Airlines has no effect on the direction of Guangdong Marubi i.e., Guangdong Marubi and China Southern go up and down completely randomly.
Pair Corralation between Guangdong Marubi and China Southern
Assuming the 90 days trading horizon Guangdong Marubi is expected to generate 2.42 times less return on investment than China Southern. In addition to that, Guangdong Marubi is 1.51 times more volatile than China Southern Airlines. It trades about 0.02 of its total potential returns per unit of risk. China Southern Airlines is currently generating about 0.07 per unit of volatility. If you would invest 587.00 in China Southern Airlines on September 5, 2024 and sell it today you would earn a total of 77.00 from holding China Southern Airlines or generate 13.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.17% |
| Values | Daily Returns |
Guangdong Marubi Biotechnology vs. China Southern Airlines
Performance |
| Timeline |
| Guangdong Marubi Bio |
| China Southern Airlines |
Guangdong Marubi and China Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Marubi and China Southern
The main advantage of trading using opposite Guangdong Marubi and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Marubi position performs unexpectedly, China Southern 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 China Southern will offset losses from the drop in China Southern's long position.| Guangdong Marubi vs. Biwin Storage Technology | Guangdong Marubi vs. PetroChina Co Ltd | Guangdong Marubi vs. Industrial and Commercial | Guangdong Marubi vs. China Construction Bank |
| China Southern vs. Xiangyang Automobile Bearing | China Southern vs. Guangdong Marubi Biotechnology | China Southern vs. Jinhe Biotechnology Co | China Southern vs. Dongfeng Automobile Co |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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