Correlation Between Guangzhou Restaurants and Servyou Software
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By analyzing existing cross correlation between Guangzhou Restaurants Group and Servyou Software Group, you can compare the effects of market volatilities on Guangzhou Restaurants and Servyou Software 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 Guangzhou Restaurants with a short position of Servyou Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Restaurants and Servyou Software.
Diversification Opportunities for Guangzhou Restaurants and Servyou Software
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guangzhou and Servyou is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Restaurants Group and Servyou Software Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Servyou Software and Guangzhou Restaurants 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 Guangzhou Restaurants Group are associated (or correlated) with Servyou Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Servyou Software has no effect on the direction of Guangzhou Restaurants i.e., Guangzhou Restaurants and Servyou Software go up and down completely randomly.
Pair Corralation between Guangzhou Restaurants and Servyou Software
Assuming the 90 days trading horizon Guangzhou Restaurants Group is expected to generate 0.54 times more return on investment than Servyou Software. However, Guangzhou Restaurants Group is 1.85 times less risky than Servyou Software. It trades about 0.17 of its potential returns per unit of risk. Servyou Software Group is currently generating about 0.05 per unit of risk. If you would invest 1,569 in Guangzhou Restaurants Group on September 25, 2024 and sell it today you would earn a total of 120.00 from holding Guangzhou Restaurants Group or generate 7.65% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Guangzhou Restaurants Group vs. Servyou Software Group
Performance |
Timeline |
Guangzhou Restaurants |
Servyou Software |
Guangzhou Restaurants and Servyou Software Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangzhou Restaurants and Servyou Software
The main advantage of trading using opposite Guangzhou Restaurants and Servyou Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Restaurants position performs unexpectedly, Servyou Software 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 Servyou Software will offset losses from the drop in Servyou Software's long position.Guangzhou Restaurants vs. Dalian Thermal Power | Guangzhou Restaurants vs. Western Metal Materials | Guangzhou Restaurants vs. Hengdian Entertainment Co | Guangzhou Restaurants vs. Guangzhou Jinyi Media |
Servyou Software vs. Industrial and Commercial | Servyou Software vs. Agricultural Bank of | Servyou Software vs. China Construction Bank | Servyou Software vs. Bank of China |
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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