Correlation Between G Bits and Anhui Gujing

Can any of the company-specific risk be diversified away by investing in both G Bits and Anhui Gujing 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 G Bits and Anhui Gujing into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between G bits Network Technology and Anhui Gujing Distillery, you can compare the effects of market volatilities on G Bits and Anhui Gujing 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 G Bits with a short position of Anhui Gujing. Check out your portfolio center. Please also check ongoing floating volatility patterns of G Bits and Anhui Gujing.

Diversification Opportunities for G Bits and Anhui Gujing

0.43

Correlation Coefficient

G Bits  Anhui Gujing

Very weak diversification

The 3 months correlation between 603444 and Anhui is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding G bits Network Technology and Anhui Gujing Distillery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Gujing Distillery and G Bits 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 G bits Network Technology are associated (or correlated) with Anhui Gujing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Gujing Distillery has no effect on the direction of G Bits i.e., G Bits and Anhui Gujing go up and down completely randomly.

Pair Corralation between G Bits and Anhui Gujing

Assuming the 90 days trading horizon G Bits is expected to generate 2.31 times less return on investment than Anhui Gujing. In addition to that, G Bits is 1.94 times more volatile than Anhui Gujing Distillery. It trades about 0.03 of its total potential returns per unit of risk. Anhui Gujing Distillery is currently generating about 0.11 per unit of volatility. If you would invest  10,795  in Anhui Gujing Distillery on December 2, 2024 and sell it today you would earn a total of  808.00  from holding Anhui Gujing Distillery or generate 7.48% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

G bits Network Technology  vs.  Anhui Gujing Distillery

G bits Network

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in G bits Network Technology are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, G Bits is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Anhui Gujing Distillery

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Anhui Gujing Distillery are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Anhui Gujing may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with G Bits and Anhui Gujing

The main advantage of trading using opposite G Bits and Anhui Gujing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G Bits position performs unexpectedly, Anhui Gujing 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 Anhui Gujing will offset losses from the drop in Anhui Gujing's long position.

The idea behind G bits Network Technology and Anhui Gujing Distillery pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.