Correlation Between Beijing Roborock and Gansu Yasheng
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By analyzing existing cross correlation between Beijing Roborock Technology and Gansu Yasheng Industrial, you can compare the effects of market volatilities on Beijing Roborock and Gansu Yasheng 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 Beijing Roborock with a short position of Gansu Yasheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Roborock and Gansu Yasheng.
Diversification Opportunities for Beijing Roborock and Gansu Yasheng
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Beijing and Gansu is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Roborock Technology and Gansu Yasheng Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Yasheng Industrial and Beijing Roborock 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 Beijing Roborock Technology are associated (or correlated) with Gansu Yasheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Yasheng Industrial has no effect on the direction of Beijing Roborock i.e., Beijing Roborock and Gansu Yasheng go up and down completely randomly.
Pair Corralation between Beijing Roborock and Gansu Yasheng
Assuming the 90 days trading horizon Beijing Roborock Technology is expected to generate 2.09 times more return on investment than Gansu Yasheng. However, Beijing Roborock is 2.09 times more volatile than Gansu Yasheng Industrial. It trades about 0.01 of its potential returns per unit of risk. Gansu Yasheng Industrial is currently generating about 0.01 per unit of risk. If you would invest 23,704 in Beijing Roborock Technology on September 2, 2024 and sell it today you would lose (2,254) from holding Beijing Roborock Technology or give up 9.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Roborock Technology vs. Gansu Yasheng Industrial
Performance |
| Timeline |
| Beijing Roborock Tec |
| Gansu Yasheng Industrial |
Beijing Roborock and Gansu Yasheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Roborock and Gansu Yasheng
The main advantage of trading using opposite Beijing Roborock and Gansu Yasheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Roborock position performs unexpectedly, Gansu Yasheng 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 Gansu Yasheng will offset losses from the drop in Gansu Yasheng's long position.The idea behind Beijing Roborock Technology and Gansu Yasheng Industrial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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