Correlation Between Chenzhou Jingui and Guangdong Failong

Can any of the company-specific risk be diversified away by investing in both Chenzhou Jingui and Guangdong Failong 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 Chenzhou Jingui and Guangdong Failong into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chenzhou Jingui Silver and Guangdong Failong Crystal, you can compare the effects of market volatilities on Chenzhou Jingui and Guangdong Failong 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 Chenzhou Jingui with a short position of Guangdong Failong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chenzhou Jingui and Guangdong Failong.

Diversification Opportunities for Chenzhou Jingui and Guangdong Failong

0.0

Correlation Coefficient

Chenzhou Jingui  Guangdong Failong

Pay attention - limited upside

The 3 months correlation between Chenzhou and Guangdong is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chenzhou Jingui Silver and Guangdong Failong Crystal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Failong Crystal and Chenzhou Jingui 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 Chenzhou Jingui Silver are associated (or correlated) with Guangdong Failong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Failong Crystal has no effect on the direction of Chenzhou Jingui i.e., Chenzhou Jingui and Guangdong Failong go up and down completely randomly.

Pair Corralation between Chenzhou Jingui and Guangdong Failong

If you would invest  329.00  in Chenzhou Jingui Silver on October 24, 2024 and sell it today you would earn a total of  26.00  from holding Chenzhou Jingui Silver or generate 7.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Chenzhou Jingui Silver  vs.  Guangdong Failong Crystal

Chenzhou Jingui Silver

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Chenzhou Jingui Silver has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Chenzhou Jingui is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Guangdong Failong Crystal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guangdong Failong Crystal has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Guangdong Failong is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Chenzhou Jingui and Guangdong Failong

The main advantage of trading using opposite Chenzhou Jingui and Guangdong Failong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chenzhou Jingui position performs unexpectedly, Guangdong Failong 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 Failong will offset losses from the drop in Guangdong Failong's long position.

The idea behind Chenzhou Jingui Silver and Guangdong Failong Crystal pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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.