Correlation Between GRIPM Advanced and Bohai Leasing
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By analyzing existing cross correlation between GRIPM Advanced Materials and Bohai Leasing Co, you can compare the effects of market volatilities on GRIPM Advanced and Bohai Leasing 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 GRIPM Advanced with a short position of Bohai Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIPM Advanced and Bohai Leasing.
Diversification Opportunities for GRIPM Advanced and Bohai Leasing
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GRIPM and Bohai is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding GRIPM Advanced Materials and Bohai Leasing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bohai Leasing and GRIPM Advanced 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 GRIPM Advanced Materials are associated (or correlated) with Bohai Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bohai Leasing has no effect on the direction of GRIPM Advanced i.e., GRIPM Advanced and Bohai Leasing go up and down completely randomly.
Pair Corralation between GRIPM Advanced and Bohai Leasing
Assuming the 90 days trading horizon GRIPM Advanced Materials is expected to generate 1.04 times more return on investment than Bohai Leasing. However, GRIPM Advanced is 1.04 times more volatile than Bohai Leasing Co. It trades about 0.19 of its potential returns per unit of risk. Bohai Leasing Co is currently generating about 0.11 per unit of risk. If you would invest 3,148 in GRIPM Advanced Materials on November 7, 2024 and sell it today you would earn a total of 154.00 from holding GRIPM Advanced Materials or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIPM Advanced Materials vs. Bohai Leasing Co
Performance |
| Timeline |
| GRIPM Advanced Materials |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Bohai Leasing |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GRIPM Advanced and Bohai Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIPM Advanced and Bohai Leasing
The main advantage of trading using opposite GRIPM Advanced and Bohai Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIPM Advanced position performs unexpectedly, Bohai Leasing 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 Bohai Leasing will offset losses from the drop in Bohai Leasing's long position.The idea behind GRIPM Advanced Materials and Bohai Leasing Co 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.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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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