Correlation Between Guangzhou Haige and Sinomach Automobile
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By analyzing existing cross correlation between Guangzhou Haige Communications and Sinomach Automobile Co, you can compare the effects of market volatilities on Guangzhou Haige and Sinomach Automobile 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 Haige with a short position of Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Haige and Sinomach Automobile.
Diversification Opportunities for Guangzhou Haige and Sinomach Automobile
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Sinomach is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Haige Communications and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile and Guangzhou Haige 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 Haige Communications are associated (or correlated) with Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Guangzhou Haige i.e., Guangzhou Haige and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Guangzhou Haige and Sinomach Automobile
Assuming the 90 days trading horizon Guangzhou Haige Communications is expected to generate 1.11 times more return on investment than Sinomach Automobile. However, Guangzhou Haige is 1.11 times more volatile than Sinomach Automobile Co. It trades about 0.06 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about 0.03 per unit of risk. If you would invest 1,059 in Guangzhou Haige Communications on September 5, 2024 and sell it today you would earn a total of 173.00 from holding Guangzhou Haige Communications or generate 16.34% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Guangzhou Haige Communications vs. Sinomach Automobile Co
Performance |
Timeline |
Guangzhou Haige Comm |
Sinomach Automobile |
Guangzhou Haige and Sinomach Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangzhou Haige and Sinomach Automobile
The main advantage of trading using opposite Guangzhou Haige and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Haige position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.Guangzhou Haige vs. Industrial and Commercial | Guangzhou Haige vs. China Construction Bank | Guangzhou Haige vs. Bank of China | Guangzhou Haige vs. Agricultural Bank of |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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