Correlation Between Columbia Greater and Guinness Atkinson
Can any of the company-specific risk be diversified away by investing in both Columbia Greater and Guinness Atkinson 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 Columbia Greater and Guinness Atkinson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Greater China and Guinness Atkinson Asia, you can compare the effects of market volatilities on Columbia Greater and Guinness Atkinson 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 Columbia Greater with a short position of Guinness Atkinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Greater and Guinness Atkinson.
Diversification Opportunities for Columbia Greater and Guinness Atkinson
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Columbia and Guinness is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Greater China and Guinness Atkinson Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guinness Atkinson Asia and Columbia Greater 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 Columbia Greater China are associated (or correlated) with Guinness Atkinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guinness Atkinson Asia has no effect on the direction of Columbia Greater i.e., Columbia Greater and Guinness Atkinson go up and down completely randomly.
Pair Corralation between Columbia Greater and Guinness Atkinson
Assuming the 90 days horizon Columbia Greater China is expected to under-perform the Guinness Atkinson. In addition to that, Columbia Greater is 1.41 times more volatile than Guinness Atkinson Asia. It trades about -0.11 of its total potential returns per unit of risk. Guinness Atkinson Asia is currently generating about -0.07 per unit of volatility. If you would invest 1,534 in Guinness Atkinson Asia on August 26, 2024 and sell it today you would lose (32.00) from holding Guinness Atkinson Asia or give up 2.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Greater China vs. Guinness Atkinson Asia
Performance |
| Timeline |
| Columbia Greater China |
| Guinness Atkinson Asia |
Columbia Greater and Guinness Atkinson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Greater and Guinness Atkinson
The main advantage of trading using opposite Columbia Greater and Guinness Atkinson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Greater position performs unexpectedly, Guinness Atkinson 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 Guinness Atkinson will offset losses from the drop in Guinness Atkinson's long position.| Columbia Greater vs. Columbia Ultra Short | Columbia Greater vs. Columbia Integrated Large | Columbia Greater vs. Columbia Integrated Large | Columbia Greater vs. Columbia Integrated Large |
| Guinness Atkinson vs. Guinness Atkinson China | Guinness Atkinson vs. Guinness Atkinson Global | Guinness Atkinson vs. Guinness Atkinson Global | Guinness Atkinson vs. Aquagold International |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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