Correlation Between MDJM and Guangdong Investment
Can any of the company-specific risk be diversified away by investing in both MDJM and Guangdong Investment 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 MDJM and Guangdong Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MDJM and Guangdong Investment Limited, you can compare the effects of market volatilities on MDJM and Guangdong Investment 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 MDJM with a short position of Guangdong Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of MDJM and Guangdong Investment.
Diversification Opportunities for MDJM and Guangdong Investment
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between MDJM and Guangdong is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding MDJM and Guangdong Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Investment and MDJM 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 MDJM are associated (or correlated) with Guangdong Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Investment has no effect on the direction of MDJM i.e., MDJM and Guangdong Investment go up and down completely randomly.
Pair Corralation between MDJM and Guangdong Investment
Given the investment horizon of 90 days MDJM is expected to under-perform the Guangdong Investment. In addition to that, MDJM is 1.13 times more volatile than Guangdong Investment Limited. It trades about -0.01 of its total potential returns per unit of risk. Guangdong Investment Limited is currently generating about 0.03 per unit of volatility. If you would invest 120.00 in Guangdong Investment Limited on October 14, 2024 and sell it today you would lose (40.00) from holding Guangdong Investment Limited or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
MDJM vs. Guangdong Investment Limited
Performance |
| Timeline |
| MDJM |
| Guangdong Investment |
MDJM and Guangdong Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MDJM and Guangdong Investment
The main advantage of trading using opposite MDJM and Guangdong Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MDJM position performs unexpectedly, Guangdong Investment 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 Guangdong Investment will offset losses from the drop in Guangdong Investment's long position.| MDJM vs. Old Republic International | MDJM vs. Selective Insurance Group | MDJM vs. SLR Investment Corp | MDJM vs. Cincinnati Financial |
| Guangdong Investment vs. Essential Utilities | Guangdong Investment vs. Guangdong Investment | Guangdong Investment vs. Anhui Conch Cement | Guangdong Investment vs. Beijing Enterprises Water |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Stocks Directory Find actively traded stocks across global markets |