Correlation Between GANGLONG CHINA and REDSUN PROPERTIES
Can any of the company-specific risk be diversified away by investing in both GANGLONG CHINA and REDSUN PROPERTIES 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 GANGLONG CHINA and REDSUN PROPERTIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GANGLONG CHINA PRGRLTD and REDSUN PROPERTIES GROUP, you can compare the effects of market volatilities on GANGLONG CHINA and REDSUN PROPERTIES 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 GANGLONG CHINA with a short position of REDSUN PROPERTIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of GANGLONG CHINA and REDSUN PROPERTIES.
Diversification Opportunities for GANGLONG CHINA and REDSUN PROPERTIES
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GANGLONG and REDSUN is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding GANGLONG CHINA PRGRLTD and REDSUN PROPERTIES GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REDSUN PROPERTIES and GANGLONG CHINA 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 GANGLONG CHINA PRGRLTD are associated (or correlated) with REDSUN PROPERTIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REDSUN PROPERTIES has no effect on the direction of GANGLONG CHINA i.e., GANGLONG CHINA and REDSUN PROPERTIES go up and down completely randomly.
Pair Corralation between GANGLONG CHINA and REDSUN PROPERTIES
Assuming the 90 days horizon GANGLONG CHINA PRGRLTD is expected to under-perform the REDSUN PROPERTIES. But the stock apears to be less risky and, when comparing its historical volatility, GANGLONG CHINA PRGRLTD is 3.06 times less risky than REDSUN PROPERTIES. The stock trades about -0.15 of its potential returns per unit of risk. The REDSUN PROPERTIES GROUP is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 0.20 in REDSUN PROPERTIES GROUP on September 24, 2024 and sell it today you would earn a total of 0.05 from holding REDSUN PROPERTIES GROUP or generate 25.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
GANGLONG CHINA PRGRLTD vs. REDSUN PROPERTIES GROUP
Performance |
Timeline |
GANGLONG CHINA PRGRLTD |
REDSUN PROPERTIES |
GANGLONG CHINA and REDSUN PROPERTIES Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GANGLONG CHINA and REDSUN PROPERTIES
The main advantage of trading using opposite GANGLONG CHINA and REDSUN PROPERTIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GANGLONG CHINA position performs unexpectedly, REDSUN PROPERTIES 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 REDSUN PROPERTIES will offset losses from the drop in REDSUN PROPERTIES's long position.GANGLONG CHINA vs. China Resources Land | GANGLONG CHINA vs. DEUTSCHE WOHNEN ADRS12 | GANGLONG CHINA vs. CTP NV EO | GANGLONG CHINA vs. SEAZEN GROUP LTD |
REDSUN PROPERTIES vs. United Airlines Holdings | REDSUN PROPERTIES vs. JD SPORTS FASH | REDSUN PROPERTIES vs. Gaztransport Technigaz SA | REDSUN PROPERTIES vs. United Breweries 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |