Correlation Between GlaxoSmithKline PLC and Shanghai Action
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By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Shanghai Action Education, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Shanghai Action 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 Shanghai Action. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Shanghai Action.
Diversification Opportunities for GlaxoSmithKline PLC and Shanghai Action
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GlaxoSmithKline and Shanghai is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Shanghai Action Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Action Education 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 Shanghai Action. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Action Education has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Shanghai Action go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Shanghai Action
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to generate 0.67 times more return on investment than Shanghai Action. However, GlaxoSmithKline PLC ADR is 1.49 times less risky than Shanghai Action. It trades about -0.3 of its potential returns per unit of risk. Shanghai Action Education is currently generating about -0.23 per unit of risk. If you would invest 3,745 in GlaxoSmithKline PLC ADR on August 28, 2024 and sell it today you would lose (330.00) from holding GlaxoSmithKline PLC ADR or give up 8.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Shanghai Action Education
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Shanghai Action Education |
GlaxoSmithKline PLC and Shanghai Action Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Shanghai Action
The main advantage of trading using opposite GlaxoSmithKline PLC and Shanghai Action positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Shanghai Action 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 Shanghai Action will offset losses from the drop in Shanghai Action'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 |
| Shanghai Action vs. Jiangsu Broadcasting Cable | Shanghai Action vs. Shaanxi Broadcast TV | Shanghai Action vs. Hubeiyichang Transportation Group | Shanghai Action vs. Shanghai Broadband Technology |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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