Correlation Between Loongson Technology and Guangzhou KingTeller
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By analyzing existing cross correlation between Loongson Technology Corp and Guangzhou KingTeller Technology, you can compare the effects of market volatilities on Loongson Technology and Guangzhou KingTeller 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 Loongson Technology with a short position of Guangzhou KingTeller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loongson Technology and Guangzhou KingTeller.
Diversification Opportunities for Loongson Technology and Guangzhou KingTeller
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Loongson and Guangzhou is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Loongson Technology Corp and Guangzhou KingTeller Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou KingTeller and Loongson Technology 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 Loongson Technology Corp are associated (or correlated) with Guangzhou KingTeller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou KingTeller has no effect on the direction of Loongson Technology i.e., Loongson Technology and Guangzhou KingTeller go up and down completely randomly.
Pair Corralation between Loongson Technology and Guangzhou KingTeller
Assuming the 90 days trading horizon Loongson Technology Corp is expected to generate 1.89 times more return on investment than Guangzhou KingTeller. However, Loongson Technology is 1.89 times more volatile than Guangzhou KingTeller Technology. It trades about 0.33 of its potential returns per unit of risk. Guangzhou KingTeller Technology is currently generating about 0.25 per unit of risk. If you would invest 12,154 in Loongson Technology Corp on November 29, 2024 and sell it today you would earn a total of 2,241 from holding Loongson Technology Corp or generate 18.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loongson Technology Corp vs. Guangzhou KingTeller Technolog
Performance |
| Timeline |
| Loongson Technology Corp |
| Guangzhou KingTeller |
Loongson Technology and Guangzhou KingTeller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loongson Technology and Guangzhou KingTeller
The main advantage of trading using opposite Loongson Technology and Guangzhou KingTeller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loongson Technology position performs unexpectedly, Guangzhou KingTeller 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 Guangzhou KingTeller will offset losses from the drop in Guangzhou KingTeller's long position.| Loongson Technology vs. Kuang Chi Technologies | Loongson Technology vs. China Sports Industry | Loongson Technology vs. Sportsoul Co Ltd | Loongson Technology vs. China Eastern Airlines |
| Guangzhou KingTeller vs. Hangzhou Pinming Software | Guangzhou KingTeller vs. Inspur Software Co | Guangzhou KingTeller vs. Will Semiconductor Co | Guangzhou KingTeller vs. Glodon Software 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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