Correlation Between Tieling Newcity and Hainan Drinda
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By analyzing existing cross correlation between Tieling Newcity Investment and Hainan Drinda Automotive, you can compare the effects of market volatilities on Tieling Newcity and Hainan Drinda 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 Tieling Newcity with a short position of Hainan Drinda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tieling Newcity and Hainan Drinda.
Diversification Opportunities for Tieling Newcity and Hainan Drinda
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tieling and Hainan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Tieling Newcity Investment and Hainan Drinda Automotive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Drinda Automotive and Tieling Newcity 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 Tieling Newcity Investment are associated (or correlated) with Hainan Drinda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Drinda Automotive has no effect on the direction of Tieling Newcity i.e., Tieling Newcity and Hainan Drinda go up and down completely randomly.
Pair Corralation between Tieling Newcity and Hainan Drinda
Assuming the 90 days trading horizon Tieling Newcity Investment is expected to generate 0.7 times more return on investment than Hainan Drinda. However, Tieling Newcity Investment is 1.44 times less risky than Hainan Drinda. It trades about 0.02 of its potential returns per unit of risk. Hainan Drinda Automotive is currently generating about -0.02 per unit of risk. If you would invest 295.00 in Tieling Newcity Investment on September 14, 2024 and sell it today you would earn a total of 20.00 from holding Tieling Newcity Investment or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Tieling Newcity Investment vs. Hainan Drinda Automotive
Performance |
| Timeline |
| Tieling Newcity Inve |
| Hainan Drinda Automotive |
Tieling Newcity and Hainan Drinda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tieling Newcity and Hainan Drinda
The main advantage of trading using opposite Tieling Newcity and Hainan Drinda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tieling Newcity position performs unexpectedly, Hainan Drinda 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 Hainan Drinda will offset losses from the drop in Hainan Drinda's long position.| Tieling Newcity vs. PetroChina Co Ltd | Tieling Newcity vs. China Mobile Limited | Tieling Newcity vs. CNOOC Limited | Tieling Newcity vs. Ping An Insurance |
| Hainan Drinda vs. Tieling Newcity Investment | Hainan Drinda vs. China Sports Industry | Hainan Drinda vs. Vanfund Urban Investment | Hainan Drinda vs. Beijing Mainstreets Investment |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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