Correlation Between Procter Gamble and Guangzhou Baiyunshan
Can any of the company-specific risk be diversified away by investing in both Procter Gamble and Guangzhou Baiyunshan 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 Procter Gamble and Guangzhou Baiyunshan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Procter Gamble and Guangzhou Baiyunshan Pharmaceutical, you can compare the effects of market volatilities on Procter Gamble and Guangzhou Baiyunshan 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 Procter Gamble with a short position of Guangzhou Baiyunshan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Procter Gamble and Guangzhou Baiyunshan.
Diversification Opportunities for Procter Gamble and Guangzhou Baiyunshan
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Procter and Guangzhou is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Procter Gamble and Guangzhou Baiyunshan Pharmaceu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Baiyunshan and Procter Gamble 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 Procter Gamble are associated (or correlated) with Guangzhou Baiyunshan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Baiyunshan has no effect on the direction of Procter Gamble i.e., Procter Gamble and Guangzhou Baiyunshan go up and down completely randomly.
Pair Corralation between Procter Gamble and Guangzhou Baiyunshan
If you would invest 16,504 in Procter Gamble on September 2, 2024 and sell it today you would earn a total of 1,422 from holding Procter Gamble or generate 8.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.79% |
| Values | Daily Returns |
Procter Gamble vs. Guangzhou Baiyunshan Pharmaceu
Performance |
| Timeline |
| Procter Gamble |
| Guangzhou Baiyunshan |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Procter Gamble and Guangzhou Baiyunshan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Procter Gamble and Guangzhou Baiyunshan
The main advantage of trading using opposite Procter Gamble and Guangzhou Baiyunshan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Procter Gamble position performs unexpectedly, Guangzhou Baiyunshan 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 Guangzhou Baiyunshan will offset losses from the drop in Guangzhou Baiyunshan's long position.| Procter Gamble vs. Colgate Palmolive | Procter Gamble vs. Unilever PLC ADR | Procter Gamble vs. Kimberly Clark | Procter Gamble vs. Estee Lauder Companies |
| Guangzhou Baiyunshan vs. Catalent | Guangzhou Baiyunshan vs. Zoetis Inc | Guangzhou Baiyunshan vs. ANI Pharmaceuticals | Guangzhou Baiyunshan vs. CV Sciences |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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