Correlation Between Yantai Changyu and Tongyu Communication
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By analyzing existing cross correlation between Yantai Changyu Pioneer and Tongyu Communication, you can compare the effects of market volatilities on Yantai Changyu and Tongyu Communication 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 Yantai Changyu with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yantai Changyu and Tongyu Communication.
Diversification Opportunities for Yantai Changyu and Tongyu Communication
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yantai and Tongyu is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Yantai Changyu Pioneer and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Yantai Changyu 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 Yantai Changyu Pioneer are associated (or correlated) with Tongyu Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongyu Communication has no effect on the direction of Yantai Changyu i.e., Yantai Changyu and Tongyu Communication go up and down completely randomly.
Pair Corralation between Yantai Changyu and Tongyu Communication
Assuming the 90 days trading horizon Yantai Changyu Pioneer is expected to under-perform the Tongyu Communication. But the stock apears to be less risky and, when comparing its historical volatility, Yantai Changyu Pioneer is 3.24 times less risky than Tongyu Communication. The stock trades about -0.1 of its potential returns per unit of risk. The Tongyu Communication is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,630 in Tongyu Communication on September 13, 2024 and sell it today you would earn a total of 8.00 from holding Tongyu Communication or generate 0.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Yantai Changyu Pioneer vs. Tongyu Communication
Performance |
| Timeline |
| Yantai Changyu Pioneer |
| Tongyu Communication |
Yantai Changyu and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yantai Changyu and Tongyu Communication
The main advantage of trading using opposite Yantai Changyu and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yantai Changyu position performs unexpectedly, Tongyu Communication 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 Tongyu Communication will offset losses from the drop in Tongyu Communication's long position.| Yantai Changyu vs. China Life Insurance | Yantai Changyu vs. Cinda Securities Co | Yantai Changyu vs. Piotech Inc A | Yantai Changyu vs. Dongxing Sec Co |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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