Correlation Between Guangzhou Zhujiang and Tibet Huayu
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By analyzing existing cross correlation between Guangzhou Zhujiang Brewery and Tibet Huayu Mining, you can compare the effects of market volatilities on Guangzhou Zhujiang and Tibet Huayu 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 Guangzhou Zhujiang with a short position of Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Zhujiang and Tibet Huayu.
Diversification Opportunities for Guangzhou Zhujiang and Tibet Huayu
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangzhou and Tibet is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Zhujiang Brewery and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining and Guangzhou Zhujiang 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 Guangzhou Zhujiang Brewery are associated (or correlated) with Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of Guangzhou Zhujiang i.e., Guangzhou Zhujiang and Tibet Huayu go up and down completely randomly.
Pair Corralation between Guangzhou Zhujiang and Tibet Huayu
Assuming the 90 days trading horizon Guangzhou Zhujiang is expected to generate 2.35 times less return on investment than Tibet Huayu. But when comparing it to its historical volatility, Guangzhou Zhujiang Brewery is 2.24 times less risky than Tibet Huayu. It trades about 0.07 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,220 in Tibet Huayu Mining on September 25, 2024 and sell it today you would earn a total of 108.00 from holding Tibet Huayu Mining or generate 8.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Guangzhou Zhujiang Brewery vs. Tibet Huayu Mining
Performance |
Timeline |
Guangzhou Zhujiang |
Tibet Huayu Mining |
Guangzhou Zhujiang and Tibet Huayu Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangzhou Zhujiang and Tibet Huayu
The main advantage of trading using opposite Guangzhou Zhujiang and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Zhujiang position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.Guangzhou Zhujiang vs. BYD Co Ltd | Guangzhou Zhujiang vs. China Mobile Limited | Guangzhou Zhujiang vs. Agricultural Bank of | Guangzhou Zhujiang vs. Industrial and Commercial |
Tibet Huayu vs. Guangdong Shenglu Telecommunication | Tibet Huayu vs. Guangzhou Zhujiang Brewery | Tibet Huayu vs. Xinjiang Baodi Mining | Tibet Huayu vs. Jiangsu Yanghe Brewery |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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