Correlation Between Guangzhou Restaurants and Xinya Electronic
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By analyzing existing cross correlation between Guangzhou Restaurants Group and Xinya Electronic Co, you can compare the effects of market volatilities on Guangzhou Restaurants and Xinya Electronic 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 Xinya Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Restaurants and Xinya Electronic.
Diversification Opportunities for Guangzhou Restaurants and Xinya Electronic
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Xinya is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Restaurants Group and Xinya Electronic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinya Electronic 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 Xinya Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinya Electronic has no effect on the direction of Guangzhou Restaurants i.e., Guangzhou Restaurants and Xinya Electronic go up and down completely randomly.
Pair Corralation between Guangzhou Restaurants and Xinya Electronic
Assuming the 90 days trading horizon Guangzhou Restaurants is expected to generate 1.35 times less return on investment than Xinya Electronic. In addition to that, Guangzhou Restaurants is 1.06 times more volatile than Xinya Electronic Co. It trades about 0.13 of its total potential returns per unit of risk. Xinya Electronic Co is currently generating about 0.19 per unit of volatility. If you would invest 1,335 in Xinya Electronic Co on September 20, 2024 and sell it today you would earn a total of 116.00 from holding Xinya Electronic Co or generate 8.69% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Guangzhou Restaurants Group vs. Xinya Electronic Co
Performance |
Timeline |
Guangzhou Restaurants |
Xinya Electronic |
Guangzhou Restaurants and Xinya Electronic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangzhou Restaurants and Xinya Electronic
The main advantage of trading using opposite Guangzhou Restaurants and Xinya Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Restaurants position performs unexpectedly, Xinya Electronic 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 Xinya Electronic will offset losses from the drop in Xinya Electronic's long position.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 |
Xinya Electronic vs. Gansu Jiu Steel | Xinya Electronic vs. Baoshan Iron Steel | Xinya Electronic vs. Shanghai Shuixing Home | Xinya Electronic vs. Guangzhou Restaurants Group |
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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