Correlation Between Telling Telecommunicatio and Guangdong Qunxing
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By analyzing existing cross correlation between Telling Telecommunication Holding and Guangdong Qunxing Toys, you can compare the effects of market volatilities on Telling Telecommunicatio and Guangdong Qunxing 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 Telling Telecommunicatio with a short position of Guangdong Qunxing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telling Telecommunicatio and Guangdong Qunxing.
Diversification Opportunities for Telling Telecommunicatio and Guangdong Qunxing
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Telling and Guangdong is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Telling Telecommunication Hold and Guangdong Qunxing Toys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Qunxing Toys and Telling Telecommunicatio 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 Telling Telecommunication Holding are associated (or correlated) with Guangdong Qunxing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Qunxing Toys has no effect on the direction of Telling Telecommunicatio i.e., Telling Telecommunicatio and Guangdong Qunxing go up and down completely randomly.
Pair Corralation between Telling Telecommunicatio and Guangdong Qunxing
Assuming the 90 days trading horizon Telling Telecommunicatio is expected to generate 1.1 times less return on investment than Guangdong Qunxing. In addition to that, Telling Telecommunicatio is 1.12 times more volatile than Guangdong Qunxing Toys. It trades about 0.02 of its total potential returns per unit of risk. Guangdong Qunxing Toys is currently generating about 0.02 per unit of volatility. If you would invest 620.00 in Guangdong Qunxing Toys on October 26, 2024 and sell it today you would earn a total of 58.00 from holding Guangdong Qunxing Toys or generate 9.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Telling Telecommunication Hold vs. Guangdong Qunxing Toys
Performance |
| Timeline |
| Telling Telecommunicatio |
| Guangdong Qunxing Toys |
Telling Telecommunicatio and Guangdong Qunxing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telling Telecommunicatio and Guangdong Qunxing
The main advantage of trading using opposite Telling Telecommunicatio and Guangdong Qunxing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telling Telecommunicatio position performs unexpectedly, Guangdong Qunxing 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 Guangdong Qunxing will offset losses from the drop in Guangdong Qunxing's long position.The idea behind Telling Telecommunication Holding and Guangdong Qunxing Toys 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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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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