Correlation Between Yuan Longping and Tianjin Hi
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By analyzing existing cross correlation between Yuan Longping High tech and Tianjin Hi Tech Development, you can compare the effects of market volatilities on Yuan Longping and Tianjin Hi 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 Yuan Longping with a short position of Tianjin Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuan Longping and Tianjin Hi.
Diversification Opportunities for Yuan Longping and Tianjin Hi
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Yuan and Tianjin is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Yuan Longping High tech and Tianjin Hi Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Hi Tech and Yuan Longping 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 Yuan Longping High tech are associated (or correlated) with Tianjin Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Hi Tech has no effect on the direction of Yuan Longping i.e., Yuan Longping and Tianjin Hi go up and down completely randomly.
Pair Corralation between Yuan Longping and Tianjin Hi
Assuming the 90 days trading horizon Yuan Longping High tech is expected to under-perform the Tianjin Hi. But the stock apears to be less risky and, when comparing its historical volatility, Yuan Longping High tech is 1.39 times less risky than Tianjin Hi. The stock trades about -0.03 of its potential returns per unit of risk. The Tianjin Hi Tech Development is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 381.00 in Tianjin Hi Tech Development on August 29, 2024 and sell it today you would lose (71.00) from holding Tianjin Hi Tech Development or give up 18.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yuan Longping High tech vs. Tianjin Hi Tech Development
Performance |
| Timeline |
| Yuan Longping High |
| Tianjin Hi Tech |
Yuan Longping and Tianjin Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yuan Longping and Tianjin Hi
The main advantage of trading using opposite Yuan Longping and Tianjin Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuan Longping position performs unexpectedly, Tianjin Hi 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 Tianjin Hi will offset losses from the drop in Tianjin Hi's long position.| Yuan Longping vs. PetroChina Co Ltd | Yuan Longping vs. China Mobile Limited | Yuan Longping vs. Ping An Insurance | Yuan Longping vs. China Petroleum Chemical |
| Tianjin Hi vs. China State Construction | Tianjin Hi vs. Huafa Industrial Co | Tianjin Hi vs. China International Capital | Tianjin Hi vs. Kweichow Moutai Co |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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