Correlation Between Guangdong Investment and NanoTech Gaming
Can any of the company-specific risk be diversified away by investing in both Guangdong Investment and NanoTech Gaming 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 Guangdong Investment and NanoTech Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guangdong Investment Limited and NanoTech Gaming, you can compare the effects of market volatilities on Guangdong Investment and NanoTech Gaming 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 Guangdong Investment with a short position of NanoTech Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Investment and NanoTech Gaming.
Diversification Opportunities for Guangdong Investment and NanoTech Gaming
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Guangdong and NanoTech is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Investment Limited and NanoTech Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NanoTech Gaming and Guangdong Investment 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 Guangdong Investment Limited are associated (or correlated) with NanoTech Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NanoTech Gaming has no effect on the direction of Guangdong Investment i.e., Guangdong Investment and NanoTech Gaming go up and down completely randomly.
Pair Corralation between Guangdong Investment and NanoTech Gaming
If you would invest 64.00 in Guangdong Investment Limited on October 24, 2024 and sell it today you would earn a total of 16.00 from holding Guangdong Investment Limited or generate 25.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 93.65% |
Values | Daily Returns |
Guangdong Investment Limited vs. NanoTech Gaming
Performance |
Timeline |
Guangdong Investment |
NanoTech Gaming |
Guangdong Investment and NanoTech Gaming Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guangdong Investment and NanoTech Gaming
The main advantage of trading using opposite Guangdong Investment and NanoTech Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Investment position performs unexpectedly, NanoTech Gaming 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 NanoTech Gaming will offset losses from the drop in NanoTech Gaming's long position.Guangdong Investment vs. Essential Utilities | Guangdong Investment vs. Guangdong Investment | Guangdong Investment vs. Anhui Conch Cement | Guangdong Investment vs. Beijing Enterprises Water |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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