Correlation Between Gan Yuan and BYD Co
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By analyzing existing cross correlation between Gan Yuan Foods and BYD Co Ltd, you can compare the effects of market volatilities on Gan Yuan and BYD Co 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 Gan Yuan with a short position of BYD Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and BYD Co.
Diversification Opportunities for Gan Yuan and BYD Co
Excellent diversification
The 3 months correlation between Gan and BYD is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and BYD Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BYD Co and Gan Yuan 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 Gan Yuan Foods are associated (or correlated) with BYD Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BYD Co has no effect on the direction of Gan Yuan i.e., Gan Yuan and BYD Co go up and down completely randomly.
Pair Corralation between Gan Yuan and BYD Co
Assuming the 90 days trading horizon Gan Yuan Foods is expected to under-perform the BYD Co. But the stock apears to be less risky and, when comparing its historical volatility, Gan Yuan Foods is 1.24 times less risky than BYD Co. The stock trades about -0.2 of its potential returns per unit of risk. The BYD Co Ltd is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 28,280 in BYD Co Ltd on December 4, 2024 and sell it today you would earn a total of 6,204 from holding BYD Co Ltd or generate 21.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Gan Yuan Foods vs. BYD Co Ltd
Performance |
Timeline |
Gan Yuan Foods |
BYD Co |
Gan Yuan and BYD Co Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Gan Yuan and BYD Co
The main advantage of trading using opposite Gan Yuan and BYD Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, BYD Co 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 BYD Co will offset losses from the drop in BYD Co's long position.Gan Yuan vs. Allied Machinery Co | Gan Yuan vs. Jiangsu Jinling Sports | Gan Yuan vs. Shuhua Sports Co | Gan Yuan vs. Shanghai Yaoji Playing |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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