Correlation Between CHINA TONTINE and GungHo Online
Can any of the company-specific risk be diversified away by investing in both CHINA TONTINE and GungHo Online at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CHINA TONTINE and GungHo Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA TONTINE WINES and GungHo Online Entertainment, you can compare the effects of market volatilities on CHINA TONTINE and GungHo Online 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 CHINA TONTINE with a short position of GungHo Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA TONTINE and GungHo Online.
Diversification Opportunities for CHINA TONTINE and GungHo Online
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHINA and GungHo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHINA TONTINE WINES and GungHo Online Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GungHo Online Entert and CHINA TONTINE 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 CHINA TONTINE WINES are associated (or correlated) with GungHo Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GungHo Online Entert has no effect on the direction of CHINA TONTINE i.e., CHINA TONTINE and GungHo Online go up and down completely randomly.
Pair Corralation between CHINA TONTINE and GungHo Online
Assuming the 90 days trading horizon CHINA TONTINE WINES is expected to generate 20.43 times more return on investment than GungHo Online. However, CHINA TONTINE is 20.43 times more volatile than GungHo Online Entertainment. It trades about 0.05 of its potential returns per unit of risk. GungHo Online Entertainment is currently generating about 0.01 per unit of risk. If you would invest 0.70 in CHINA TONTINE WINES on September 2, 2024 and sell it today you would earn a total of 6.30 from holding CHINA TONTINE WINES or generate 900.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
CHINA TONTINE WINES vs. GungHo Online Entertainment
Performance |
| Timeline |
| CHINA TONTINE WINES |
| GungHo Online Entert |
CHINA TONTINE and GungHo Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHINA TONTINE and GungHo Online
The main advantage of trading using opposite CHINA TONTINE and GungHo Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA TONTINE position performs unexpectedly, GungHo Online 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 GungHo Online will offset losses from the drop in GungHo Online's long position.| CHINA TONTINE vs. Superior Plus Corp | CHINA TONTINE vs. NMI Holdings | CHINA TONTINE vs. Origin Agritech | CHINA TONTINE vs. SIVERS SEMICONDUCTORS AB |
| GungHo Online vs. Nintendo Co | GungHo Online vs. Sea Limited | GungHo Online vs. Superior Plus Corp | GungHo Online vs. NMI Holdings |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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