Correlation Between GlaxoSmithKline PLC and Zhejiang Yayi
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By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Zhejiang Yayi Metal, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Zhejiang Yayi 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 GlaxoSmithKline PLC with a short position of Zhejiang Yayi. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Zhejiang Yayi.
Diversification Opportunities for GlaxoSmithKline PLC and Zhejiang Yayi
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GlaxoSmithKline and Zhejiang is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Zhejiang Yayi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yayi Metal and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with Zhejiang Yayi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yayi Metal has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Zhejiang Yayi go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Zhejiang Yayi
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to under-perform the Zhejiang Yayi. But the stock apears to be less risky and, when comparing its historical volatility, GlaxoSmithKline PLC ADR is 2.0 times less risky than Zhejiang Yayi. The stock trades about -0.23 of its potential returns per unit of risk. The Zhejiang Yayi Metal is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,477 in Zhejiang Yayi Metal on September 1, 2024 and sell it today you would earn a total of 196.00 from holding Zhejiang Yayi Metal or generate 7.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Zhejiang Yayi Metal
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Zhejiang Yayi Metal |
GlaxoSmithKline PLC and Zhejiang Yayi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Zhejiang Yayi
The main advantage of trading using opposite GlaxoSmithKline PLC and Zhejiang Yayi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Zhejiang Yayi 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 Zhejiang Yayi will offset losses from the drop in Zhejiang Yayi's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
| Zhejiang Yayi vs. Fujian Nanwang Environment | Zhejiang Yayi vs. Panda Financial Holding | Zhejiang Yayi vs. Elite Color Environmental | Zhejiang Yayi vs. Jiangsu Financial Leasing |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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