Correlation Between MayAir Technology and Guangdong Liantai
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By analyzing existing cross correlation between MayAir Technology Co and Guangdong Liantai Environmental, you can compare the effects of market volatilities on MayAir Technology and Guangdong Liantai 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 MayAir Technology with a short position of Guangdong Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of MayAir Technology and Guangdong Liantai.
Diversification Opportunities for MayAir Technology and Guangdong Liantai
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MayAir and Guangdong is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding MayAir Technology Co and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai and MayAir 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 MayAir Technology Co are associated (or correlated) with Guangdong Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of MayAir Technology i.e., MayAir Technology and Guangdong Liantai go up and down completely randomly.
Pair Corralation between MayAir Technology and Guangdong Liantai
Assuming the 90 days trading horizon MayAir Technology Co is expected to generate 0.99 times more return on investment than Guangdong Liantai. However, MayAir Technology Co is 1.01 times less risky than Guangdong Liantai. It trades about -0.11 of its potential returns per unit of risk. Guangdong Liantai Environmental is currently generating about -0.31 per unit of risk. If you would invest 3,534 in MayAir Technology Co on October 17, 2024 and sell it today you would lose (189.00) from holding MayAir Technology Co or give up 5.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MayAir Technology Co vs. Guangdong Liantai Environmenta
Performance |
| Timeline |
| MayAir Technology |
| Guangdong Liantai |
MayAir Technology and Guangdong Liantai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MayAir Technology and Guangdong Liantai
The main advantage of trading using opposite MayAir Technology and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MayAir Technology position performs unexpectedly, Guangdong Liantai 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 Guangdong Liantai will offset losses from the drop in Guangdong Liantai's long position.The idea behind MayAir Technology Co and Guangdong Liantai Environmental 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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