Correlation Between Zhongtong Guomai and Guangzhou Restaurants
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By analyzing existing cross correlation between Zhongtong Guomai Communication and Guangzhou Restaurants Group, you can compare the effects of market volatilities on Zhongtong Guomai 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 Zhongtong Guomai with a short position of Guangzhou Restaurants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongtong Guomai and Guangzhou Restaurants.
Diversification Opportunities for Zhongtong Guomai and Guangzhou Restaurants
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhongtong and Guangzhou is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Zhongtong Guomai Communication and Guangzhou Restaurants Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Restaurants and Zhongtong Guomai 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 Zhongtong Guomai Communication 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 Zhongtong Guomai i.e., Zhongtong Guomai and Guangzhou Restaurants go up and down completely randomly.
Pair Corralation between Zhongtong Guomai and Guangzhou Restaurants
Assuming the 90 days trading horizon Zhongtong Guomai Communication is expected to under-perform the Guangzhou Restaurants. In addition to that, Zhongtong Guomai is 1.44 times more volatile than Guangzhou Restaurants Group. It trades about -0.04 of its total potential returns per unit of risk. Guangzhou Restaurants Group is currently generating about 0.17 per unit of volatility. If you would invest 1,569 in Guangzhou Restaurants Group on September 24, 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 | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Zhongtong Guomai Communication vs. Guangzhou Restaurants Group
Performance |
Timeline |
Zhongtong Guomai Com |
Guangzhou Restaurants |
Zhongtong Guomai and Guangzhou Restaurants Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhongtong Guomai and Guangzhou Restaurants
The main advantage of trading using opposite Zhongtong Guomai and Guangzhou Restaurants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongtong Guomai 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.Zhongtong Guomai vs. Kweichow Moutai Co | Zhongtong Guomai vs. Shenzhen Mindray Bio Medical | Zhongtong Guomai vs. Jiangsu Pacific Quartz | Zhongtong Guomai 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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