Correlation Between Hwabao WP and Guangdong Ellington
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By analyzing existing cross correlation between Hwabao WP CSI and Guangdong Ellington Electronics, you can compare the effects of market volatilities on Hwabao WP and Guangdong Ellington 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 Hwabao WP with a short position of Guangdong Ellington. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hwabao WP and Guangdong Ellington.
Diversification Opportunities for Hwabao WP and Guangdong Ellington
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hwabao and Guangdong is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Hwabao WP CSI and Guangdong Ellington Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Ellington and Hwabao WP 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 Hwabao WP CSI are associated (or correlated) with Guangdong Ellington. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Ellington has no effect on the direction of Hwabao WP i.e., Hwabao WP and Guangdong Ellington go up and down completely randomly.
Pair Corralation between Hwabao WP and Guangdong Ellington
Assuming the 90 days trading horizon Hwabao WP is expected to generate 5.68 times less return on investment than Guangdong Ellington. But when comparing it to its historical volatility, Hwabao WP CSI is 1.45 times less risky than Guangdong Ellington. It trades about 0.01 of its potential returns per unit of risk. Guangdong Ellington Electronics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 682.00 in Guangdong Ellington Electronics on October 7, 2024 and sell it today you would earn a total of 198.00 from holding Guangdong Ellington Electronics or generate 29.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hwabao WP CSI vs. Guangdong Ellington Electronic
Performance |
Timeline |
Hwabao WP CSI |
Guangdong Ellington |
Hwabao WP and Guangdong Ellington Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hwabao WP and Guangdong Ellington
The main advantage of trading using opposite Hwabao WP and Guangdong Ellington positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hwabao WP position performs unexpectedly, Guangdong Ellington 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 Ellington will offset losses from the drop in Guangdong Ellington's long position.Hwabao WP vs. Hwabao WP CSI | Hwabao WP vs. Hwabao WP CS | Hwabao WP vs. Hwabao WP SSE | Hwabao WP vs. Hwabao WP SP |
Guangdong Ellington vs. PetroChina Co Ltd | Guangdong Ellington vs. Gansu Jiu Steel | Guangdong Ellington vs. Aba Chemicals Corp | Guangdong Ellington vs. Yes Optoelectronics Co |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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