Correlation Between Guangzhou Fangbang and Kuang Chi
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By analyzing existing cross correlation between Guangzhou Fangbang Electronics and Kuang Chi Technologies, you can compare the effects of market volatilities on Guangzhou Fangbang and Kuang Chi 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 Guangzhou Fangbang with a short position of Kuang Chi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Fangbang and Kuang Chi.
Diversification Opportunities for Guangzhou Fangbang and Kuang Chi
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Kuang is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Fangbang Electronics and Kuang Chi Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuang Chi Technologies and Guangzhou Fangbang 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 Guangzhou Fangbang Electronics are associated (or correlated) with Kuang Chi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuang Chi Technologies has no effect on the direction of Guangzhou Fangbang i.e., Guangzhou Fangbang and Kuang Chi go up and down completely randomly.
Pair Corralation between Guangzhou Fangbang and Kuang Chi
Assuming the 90 days trading horizon Guangzhou Fangbang is expected to generate 5.18 times less return on investment than Kuang Chi. In addition to that, Guangzhou Fangbang is 1.1 times more volatile than Kuang Chi Technologies. It trades about 0.04 of its total potential returns per unit of risk. Kuang Chi Technologies is currently generating about 0.22 per unit of volatility. If you would invest 1,721 in Kuang Chi Technologies on September 26, 2024 and sell it today you would earn a total of 2,694 from holding Kuang Chi Technologies or generate 156.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Fangbang Electronics vs. Kuang Chi Technologies
Performance |
| Timeline |
| Guangzhou Fangbang |
| Kuang Chi Technologies |
Guangzhou Fangbang and Kuang Chi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Fangbang and Kuang Chi
The main advantage of trading using opposite Guangzhou Fangbang and Kuang Chi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Fangbang position performs unexpectedly, Kuang Chi 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 Kuang Chi will offset losses from the drop in Kuang Chi's long position.| Guangzhou Fangbang vs. Industrial and Commercial | Guangzhou Fangbang vs. China Construction Bank | Guangzhou Fangbang vs. Agricultural Bank of | Guangzhou Fangbang vs. Bank of China |
| Kuang Chi vs. China Life Insurance | Kuang Chi vs. Cinda Securities Co | Kuang Chi vs. Piotech Inc A | Kuang Chi vs. Dongxing Sec 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 Stocks Directory module to find actively traded stocks across global markets.
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