Correlation Between Telling Telecommunicatio and Shenzhen Zhongzhuang
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By analyzing existing cross correlation between Telling Telecommunication Holding and Shenzhen Zhongzhuang Construction, you can compare the effects of market volatilities on Telling Telecommunicatio and Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telling Telecommunicatio and Shenzhen Zhongzhuang.
Diversification Opportunities for Telling Telecommunicatio and Shenzhen Zhongzhuang
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Telling and Shenzhen is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Telling Telecommunication Hold and Shenzhen Zhongzhuang Construct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Zhongzhuang has no effect on the direction of Telling Telecommunicatio i.e., Telling Telecommunicatio and Shenzhen Zhongzhuang go up and down completely randomly.
Pair Corralation between Telling Telecommunicatio and Shenzhen Zhongzhuang
Assuming the 90 days trading horizon Telling Telecommunication Holding is expected to generate 1.09 times more return on investment than Shenzhen Zhongzhuang. However, Telling Telecommunicatio is 1.09 times more volatile than Shenzhen Zhongzhuang Construction. It trades about 0.04 of its potential returns per unit of risk. Shenzhen Zhongzhuang Construction is currently generating about -0.01 per unit of risk. If you would invest 803.00 in Telling Telecommunication Holding on October 16, 2024 and sell it today you would earn a total of 245.00 from holding Telling Telecommunication Holding or generate 30.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telling Telecommunication Hold vs. Shenzhen Zhongzhuang Construct
Performance |
| Timeline |
| Telling Telecommunicatio |
| Shenzhen Zhongzhuang |
Telling Telecommunicatio and Shenzhen Zhongzhuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telling Telecommunicatio and Shenzhen Zhongzhuang
The main advantage of trading using opposite Telling Telecommunicatio and Shenzhen Zhongzhuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telling Telecommunicatio position performs unexpectedly, Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang will offset losses from the drop in Shenzhen Zhongzhuang's long position.The idea behind Telling Telecommunication Holding and Shenzhen Zhongzhuang Construction 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.
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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