Correlation Between Sinosteel Engineering and Tongxing Environmental
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By analyzing existing cross correlation between Sinosteel Engineering and and Tongxing Environmental Protection, you can compare the effects of market volatilities on Sinosteel Engineering and Tongxing Environmental 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 Sinosteel Engineering with a short position of Tongxing Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinosteel Engineering and Tongxing Environmental.
Diversification Opportunities for Sinosteel Engineering and Tongxing Environmental
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sinosteel and Tongxing is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Sinosteel Engineering and and Tongxing Environmental Protect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongxing Environmental and Sinosteel Engineering 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 Sinosteel Engineering and are associated (or correlated) with Tongxing Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongxing Environmental has no effect on the direction of Sinosteel Engineering i.e., Sinosteel Engineering and Tongxing Environmental go up and down completely randomly.
Pair Corralation between Sinosteel Engineering and Tongxing Environmental
Assuming the 90 days trading horizon Sinosteel Engineering is expected to generate 1.82 times less return on investment than Tongxing Environmental. But when comparing it to its historical volatility, Sinosteel Engineering and is 1.49 times less risky than Tongxing Environmental. It trades about 0.26 of its potential returns per unit of risk. Tongxing Environmental Protection is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,362 in Tongxing Environmental Protection on August 25, 2024 and sell it today you would earn a total of 309.00 from holding Tongxing Environmental Protection or generate 22.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinosteel Engineering and vs. Tongxing Environmental Protect
Performance |
| Timeline |
| Sinosteel Engineering and |
| Tongxing Environmental |
Sinosteel Engineering and Tongxing Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinosteel Engineering and Tongxing Environmental
The main advantage of trading using opposite Sinosteel Engineering and Tongxing Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinosteel Engineering position performs unexpectedly, Tongxing Environmental 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 Tongxing Environmental will offset losses from the drop in Tongxing Environmental's long position.| Sinosteel Engineering vs. Ming Yang Smart | Sinosteel Engineering vs. 159681 | Sinosteel Engineering vs. 159005 | Sinosteel Engineering vs. Loctek Ergonomic Technology |
| Tongxing Environmental vs. China Petroleum Chemical | Tongxing Environmental vs. PetroChina Co Ltd | Tongxing Environmental vs. China State Construction | Tongxing Environmental vs. China Railway Group |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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