Correlation Between Jiangsu GDK and Guangzhou Seagull
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By analyzing existing cross correlation between Jiangsu GDK Biotechnology and Guangzhou Seagull Kitchen, you can compare the effects of market volatilities on Jiangsu GDK 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 Jiangsu GDK with a short position of Guangzhou Seagull. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu GDK and Guangzhou Seagull.
Diversification Opportunities for Jiangsu GDK and Guangzhou Seagull
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangsu and Guangzhou is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu GDK 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 Jiangsu GDK 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 Jiangsu GDK 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 Jiangsu GDK i.e., Jiangsu GDK and Guangzhou Seagull go up and down completely randomly.
Pair Corralation between Jiangsu GDK and Guangzhou Seagull
Assuming the 90 days trading horizon Jiangsu GDK Biotechnology is expected to under-perform the Guangzhou Seagull. In addition to that, Jiangsu GDK is 1.23 times more volatile than Guangzhou Seagull Kitchen. It trades about -0.05 of its total potential returns per unit of risk. Guangzhou Seagull Kitchen is currently generating about 0.0 per unit of volatility. If you would invest 401.00 in Guangzhou Seagull Kitchen on September 2, 2024 and sell it today you would lose (63.00) from holding Guangzhou Seagull Kitchen or give up 15.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu GDK Biotechnology vs. Guangzhou Seagull Kitchen
Performance |
| Timeline |
| Jiangsu GDK Biotechnology |
| Guangzhou Seagull Kitchen |
Jiangsu GDK and Guangzhou Seagull Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu GDK and Guangzhou Seagull
The main advantage of trading using opposite Jiangsu GDK and Guangzhou Seagull positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu GDK 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.| Jiangsu GDK vs. PetroChina Co Ltd | Jiangsu GDK vs. China Mobile Limited | Jiangsu GDK vs. CNOOC Limited | Jiangsu GDK vs. Ping An Insurance |
| Guangzhou Seagull vs. Industrial and Commercial | Guangzhou Seagull vs. Kweichow Moutai Co | Guangzhou Seagull vs. Agricultural Bank of | Guangzhou Seagull vs. China Mobile Limited |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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