Correlation Between GlaxoSmithKline PLC and Zhuzhou Kibing
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By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Zhuzhou Kibing Group, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Zhuzhou Kibing 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 Zhuzhou Kibing. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Zhuzhou Kibing.
Diversification Opportunities for GlaxoSmithKline PLC and Zhuzhou Kibing
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GlaxoSmithKline and Zhuzhou is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Zhuzhou Kibing Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhuzhou Kibing Group 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 Zhuzhou Kibing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhuzhou Kibing Group has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Zhuzhou Kibing go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Zhuzhou Kibing
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to generate 0.65 times more return on investment than Zhuzhou Kibing. However, GlaxoSmithKline PLC ADR is 1.54 times less risky than Zhuzhou Kibing. It trades about -0.27 of its potential returns per unit of risk. Zhuzhou Kibing Group is currently generating about -0.33 per unit of risk. If you would invest 3,745 in GlaxoSmithKline PLC ADR on August 29, 2024 and sell it today you would lose (312.00) from holding GlaxoSmithKline PLC ADR or give up 8.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Zhuzhou Kibing Group
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Zhuzhou Kibing Group |
GlaxoSmithKline PLC and Zhuzhou Kibing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Zhuzhou Kibing
The main advantage of trading using opposite GlaxoSmithKline PLC and Zhuzhou Kibing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Zhuzhou Kibing 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 Zhuzhou Kibing will offset losses from the drop in Zhuzhou Kibing'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 |
| Zhuzhou Kibing vs. Guangzhou Haige Communications | Zhuzhou Kibing vs. Eastern Communications Co | Zhuzhou Kibing vs. Sunwave Communications Co | Zhuzhou Kibing vs. Shenzhen Kexin Communication |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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