Correlation Between Changchun BCHT and Guangzhou Seagull
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Guangzhou Seagull Kitchen, you can compare the effects of market volatilities on Changchun BCHT and Guangzhou Seagull 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 Changchun BCHT with a short position of Guangzhou Seagull. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Guangzhou Seagull.
Diversification Opportunities for Changchun BCHT and Guangzhou Seagull
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Changchun and Guangzhou is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Guangzhou Seagull Kitchen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Seagull Kitchen and Changchun BCHT 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 Changchun BCHT Biotechnology are associated (or correlated) with Guangzhou Seagull. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Seagull Kitchen has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Guangzhou Seagull go up and down completely randomly.
Pair Corralation between Changchun BCHT and Guangzhou Seagull
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to generate 0.44 times more return on investment than Guangzhou Seagull. However, Changchun BCHT Biotechnology is 2.25 times less risky than Guangzhou Seagull. It trades about -0.42 of its potential returns per unit of risk. Guangzhou Seagull Kitchen is currently generating about -0.27 per unit of risk. If you would invest 2,710 in Changchun BCHT Biotechnology on October 14, 2024 and sell it today you would lose (411.00) from holding Changchun BCHT Biotechnology or give up 15.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Guangzhou Seagull Kitchen
Performance |
| Timeline |
| Changchun BCHT Biote |
| Guangzhou Seagull Kitchen |
Changchun BCHT and Guangzhou Seagull Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Guangzhou Seagull
The main advantage of trading using opposite Changchun BCHT and Guangzhou Seagull positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Guangzhou Seagull 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 Seagull will offset losses from the drop in Guangzhou Seagull's long position.| Changchun BCHT vs. Shanghai Phichem Material | Changchun BCHT vs. Malion New Materials | Changchun BCHT vs. Anhui Transport Consulting | Changchun BCHT vs. Hainan Haiqi Transportation |
| Guangzhou Seagull vs. Jilin Chemical Fibre | Guangzhou Seagull vs. Sichuan Hebang Biotechnology | Guangzhou Seagull vs. Changchun BCHT Biotechnology | Guangzhou Seagull vs. Dymatic Chemicals |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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