Correlation Between Suzhou Novoprotein and Guangzhou KDT
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By analyzing existing cross correlation between Suzhou Novoprotein Scientific and Guangzhou KDT Machinery, you can compare the effects of market volatilities on Suzhou Novoprotein and Guangzhou KDT 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 Suzhou Novoprotein with a short position of Guangzhou KDT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Novoprotein and Guangzhou KDT.
Diversification Opportunities for Suzhou Novoprotein and Guangzhou KDT
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Suzhou and Guangzhou is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Novoprotein Scientific and Guangzhou KDT Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou KDT Machinery and Suzhou Novoprotein 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 Suzhou Novoprotein Scientific are associated (or correlated) with Guangzhou KDT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou KDT Machinery has no effect on the direction of Suzhou Novoprotein i.e., Suzhou Novoprotein and Guangzhou KDT go up and down completely randomly.
Pair Corralation between Suzhou Novoprotein and Guangzhou KDT
Assuming the 90 days trading horizon Suzhou Novoprotein Scientific is expected to under-perform the Guangzhou KDT. In addition to that, Suzhou Novoprotein is 1.12 times more volatile than Guangzhou KDT Machinery. It trades about -0.06 of its total potential returns per unit of risk. Guangzhou KDT Machinery is currently generating about 0.03 per unit of volatility. If you would invest 1,343 in Guangzhou KDT Machinery on October 26, 2024 and sell it today you would earn a total of 401.00 from holding Guangzhou KDT Machinery or generate 29.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Novoprotein Scientific vs. Guangzhou KDT Machinery
Performance |
| Timeline |
| Suzhou Novoprotein |
| Guangzhou KDT Machinery |
Suzhou Novoprotein and Guangzhou KDT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Novoprotein and Guangzhou KDT
The main advantage of trading using opposite Suzhou Novoprotein and Guangzhou KDT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Novoprotein position performs unexpectedly, Guangzhou KDT 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 KDT will offset losses from the drop in Guangzhou KDT's long position.| Suzhou Novoprotein vs. Konfoong Materials International | Suzhou Novoprotein vs. Muyuan Foodstuff Co | Suzhou Novoprotein vs. Anji Foodstuff Co | Suzhou Novoprotein vs. Western Metal Materials |
| Guangzhou KDT vs. PetroChina Co Ltd | Guangzhou KDT vs. Industrial and Commercial | Guangzhou KDT vs. China Petroleum Chemical | Guangzhou KDT vs. China Construction Bank |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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