Correlation Between RMG Acquisition and China Gas
Can any of the company-specific risk be diversified away by investing in both RMG Acquisition and China Gas 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 RMG Acquisition and China Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RMG Acquisition Corp and China Gas Holdings, you can compare the effects of market volatilities on RMG Acquisition and China Gas 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 RMG Acquisition with a short position of China Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of RMG Acquisition and China Gas.
Diversification Opportunities for RMG Acquisition and China Gas
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between RMG and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding RMG Acquisition Corp and China Gas Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Gas Holdings and RMG Acquisition 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 RMG Acquisition Corp are associated (or correlated) with China Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Gas Holdings has no effect on the direction of RMG Acquisition i.e., RMG Acquisition and China Gas go up and down completely randomly.
Pair Corralation between RMG Acquisition and China Gas
If you would invest 84.00 in China Gas Holdings on November 28, 2024 and sell it today you would earn a total of 2.00 from holding China Gas Holdings or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
RMG Acquisition Corp vs. China Gas Holdings
Performance |
| Timeline |
| RMG Acquisition Corp |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| China Gas Holdings |
RMG Acquisition and China Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RMG Acquisition and China Gas
The main advantage of trading using opposite RMG Acquisition and China Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RMG Acquisition position performs unexpectedly, China Gas 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 China Gas will offset losses from the drop in China Gas' long position.| RMG Acquisition vs. Verra Mobility Corp | RMG Acquisition vs. Treasury Wine Estates | RMG Acquisition vs. MGP Ingredients | RMG Acquisition vs. Canlan Ice Sports |
| China Gas vs. Games Workshop Group | China Gas vs. Here Media | China Gas vs. Gamehost | China Gas vs. Silicon Gaming |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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