Correlation Between Guangdong Marubi and Orinko Advanced
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By analyzing existing cross correlation between Guangdong Marubi Biotechnology and Orinko Advanced Plastics, you can compare the effects of market volatilities on Guangdong Marubi and Orinko Advanced 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 Orinko Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Marubi and Orinko Advanced.
Diversification Opportunities for Guangdong Marubi and Orinko Advanced
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Guangdong and Orinko is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Marubi Biotechnology and Orinko Advanced Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orinko Advanced Plastics 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 Orinko Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orinko Advanced Plastics has no effect on the direction of Guangdong Marubi i.e., Guangdong Marubi and Orinko Advanced go up and down completely randomly.
Pair Corralation between Guangdong Marubi and Orinko Advanced
Assuming the 90 days trading horizon Guangdong Marubi Biotechnology is expected to under-perform the Orinko Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Guangdong Marubi Biotechnology is 2.09 times less risky than Orinko Advanced. The stock trades about -0.15 of its potential returns per unit of risk. The Orinko Advanced Plastics is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,108 in Orinko Advanced Plastics on November 25, 2024 and sell it today you would earn a total of 261.00 from holding Orinko Advanced Plastics or generate 23.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Guangdong Marubi Biotechnology vs. Orinko Advanced Plastics
Performance |
Timeline |
Guangdong Marubi Bio |
Orinko Advanced Plastics |
Guangdong Marubi and Orinko Advanced Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangdong Marubi and Orinko Advanced
The main advantage of trading using opposite Guangdong Marubi and Orinko Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Marubi position performs unexpectedly, Orinko Advanced 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 Orinko Advanced will offset losses from the drop in Orinko Advanced's long position.Guangdong Marubi vs. Kuaijishan Shaoxing Rice | ||
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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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