Correlation Between LianChuang Electronic and TianJin 712
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By analyzing existing cross correlation between LianChuang Electronic Technology and TianJin 712 Communication, you can compare the effects of market volatilities on LianChuang Electronic and TianJin 712 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 LianChuang Electronic with a short position of TianJin 712. Check out your portfolio center. Please also check ongoing floating volatility patterns of LianChuang Electronic and TianJin 712.
Diversification Opportunities for LianChuang Electronic and TianJin 712
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between LianChuang and TianJin is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding LianChuang Electronic Technolo and TianJin 712 Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TianJin 712 Communication and LianChuang Electronic 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 LianChuang Electronic Technology are associated (or correlated) with TianJin 712. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TianJin 712 Communication has no effect on the direction of LianChuang Electronic i.e., LianChuang Electronic and TianJin 712 go up and down completely randomly.
Pair Corralation between LianChuang Electronic and TianJin 712
Assuming the 90 days trading horizon LianChuang Electronic Technology is expected to generate 0.99 times more return on investment than TianJin 712. However, LianChuang Electronic Technology is 1.01 times less risky than TianJin 712. It trades about -0.17 of its potential returns per unit of risk. TianJin 712 Communication is currently generating about -0.32 per unit of risk. If you would invest 986.00 in LianChuang Electronic Technology on October 30, 2024 and sell it today you would lose (102.00) from holding LianChuang Electronic Technology or give up 10.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LianChuang Electronic Technolo vs. TianJin 712 Communication
Performance |
| Timeline |
| LianChuang Electronic |
| TianJin 712 Communication |
LianChuang Electronic and TianJin 712 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LianChuang Electronic and TianJin 712
The main advantage of trading using opposite LianChuang Electronic and TianJin 712 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LianChuang Electronic position performs unexpectedly, TianJin 712 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 712 will offset losses from the drop in TianJin 712's long position.| LianChuang Electronic vs. Qijing Machinery | LianChuang Electronic vs. Huaibei Mining Holdings | LianChuang Electronic vs. Tjk Machinery Tianjin | LianChuang Electronic vs. Masterwork Machinery |
| TianJin 712 vs. Touchstone International Medical | TianJin 712 vs. Zhongzhu Medical Holdings | TianJin 712 vs. Kidswant Children Products | TianJin 712 vs. Double Medical Technology |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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