Correlation Between Guinness Atkinson and Guinness Atkinson

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

By analyzing existing cross correlation between Guinness Atkinson China and Guinness Atkinson Asia, you can compare the effects of market volatilities on Guinness Atkinson and Guinness Atkinson 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 Guinness Atkinson with a short position of Guinness Atkinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guinness Atkinson and Guinness Atkinson.

Diversification Opportunities for Guinness Atkinson and Guinness Atkinson

0.94

Correlation Coefficient

Guinness Atkinson  Guinness Atkinson

Almost no diversification

The 3 months correlation between Guinness and Guinness is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Guinness Atkinson China and Guinness Atkinson Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guinness Atkinson Asia and Guinness Atkinson 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 Guinness Atkinson China are associated (or correlated) with Guinness Atkinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guinness Atkinson Asia has no effect on the direction of Guinness Atkinson i.e., Guinness Atkinson and Guinness Atkinson go up and down completely randomly.

Pair Corralation between Guinness Atkinson and Guinness Atkinson

Assuming the 90 days horizon Guinness Atkinson China is expected to generate 1.55 times more return on investment than Guinness Atkinson. However, Guinness Atkinson is 1.55 times more volatile than Guinness Atkinson Asia. It trades about 0.11 of its potential returns per unit of risk. Guinness Atkinson Asia is currently generating about 0.06 per unit of risk. If you would invest  1,119  in Guinness Atkinson China on September 3, 2024 and sell it today you would earn a total of  177.00  from holding Guinness Atkinson China or generate 15.82% return on investment over 90 days.

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

Guinness Atkinson China  vs.  Guinness Atkinson Asia

Guinness Atkinson China

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Guinness Atkinson China are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Guinness Atkinson showed solid returns over the last few months and may actually be approaching a breakup point.

Guinness Atkinson Asia

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Guinness Atkinson Asia are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Guinness Atkinson is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Guinness Atkinson and Guinness Atkinson

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

The idea behind Guinness Atkinson China and Guinness Atkinson Asia 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.