Correlation Between Northern United and Guangzhou Restaurants
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By analyzing existing cross correlation between Northern United Publishing and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Northern United and Guangzhou Restaurants 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 Northern United with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Northern United and Guangzhou Restaurants.
Diversification Opportunities for Northern United and Guangzhou Restaurants
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Northern and Guangzhou is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Northern United Publishing and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Northern United 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 Northern United Publishing are associated (or correlated) with Guangzhou Restaurants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Restaurants has no effect on the direction of Northern United i.e., Northern United and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Northern United and Guangzhou Restaurants
Assuming the 90 days trading horizon Northern United Publishing is expected to generate 1.0 times more return on investment than Guangzhou Restaurants. However, Northern United Publishing is 1.0 times less risky than Guangzhou Restaurants. It trades about 0.24 of its potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about 0.2 per unit of risk. If you would invest 529.00 in Northern United Publishing on September 15, 2024 and sell it today you would earn a total of 241.00 from holding Northern United Publishing or generate 45.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Northern United Publishing vs. Guangzhou Restaurants Group
Performance |
Timeline |
Northern United Publ |
Guangzhou Restaurants |
Northern United and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Northern United and Guangzhou Restaurants
The main advantage of trading using opposite Northern United and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Northern United position performs unexpectedly, Guangzhou Restaurants 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 Guangzhou Restaurants will offset losses from the drop in Guangzhou Restaurants' long position.Northern United vs. Zhejiang Publishing Media | Northern United vs. Western Metal Materials | Northern United vs. Zhejiang Yayi Metal | Northern United vs. Tongling Nonferrous Metals |
Guangzhou Restaurants vs. Kweichow Moutai Co | Guangzhou Restaurants vs. Shenzhen Mindray Bio Medical | Guangzhou Restaurants vs. Jiangsu Pacific Quartz | Guangzhou Restaurants vs. G bits Network Technology |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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