Correlation Between TongFu Microelectronics and Zhejiang Tailin
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By analyzing existing cross correlation between TongFu Microelectronics Co and Zhejiang Tailin Bioengineering, you can compare the effects of market volatilities on TongFu Microelectronics and Zhejiang Tailin 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 TongFu Microelectronics with a short position of Zhejiang Tailin. Check out your portfolio center. Please also check ongoing floating volatility patterns of TongFu Microelectronics and Zhejiang Tailin.
Diversification Opportunities for TongFu Microelectronics and Zhejiang Tailin
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TongFu and Zhejiang is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding TongFu Microelectronics Co and Zhejiang Tailin Bioengineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Tailin Bioe and TongFu Microelectronics 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 TongFu Microelectronics Co are associated (or correlated) with Zhejiang Tailin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Tailin Bioe has no effect on the direction of TongFu Microelectronics i.e., TongFu Microelectronics and Zhejiang Tailin go up and down completely randomly.
Pair Corralation between TongFu Microelectronics and Zhejiang Tailin
Assuming the 90 days trading horizon TongFu Microelectronics Co is expected to generate 1.26 times more return on investment than Zhejiang Tailin. However, TongFu Microelectronics is 1.26 times more volatile than Zhejiang Tailin Bioengineering. It trades about 0.03 of its potential returns per unit of risk. Zhejiang Tailin Bioengineering is currently generating about -0.21 per unit of risk. If you would invest 2,850 in TongFu Microelectronics Co on October 17, 2024 and sell it today you would earn a total of 20.00 from holding TongFu Microelectronics Co or generate 0.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
TongFu Microelectronics Co vs. Zhejiang Tailin Bioengineering
Performance |
| Timeline |
| TongFu Microelectronics |
| Zhejiang Tailin Bioe |
TongFu Microelectronics and Zhejiang Tailin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TongFu Microelectronics and Zhejiang Tailin
The main advantage of trading using opposite TongFu Microelectronics and Zhejiang Tailin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TongFu Microelectronics position performs unexpectedly, Zhejiang Tailin 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 Zhejiang Tailin will offset losses from the drop in Zhejiang Tailin's long position.| TongFu Microelectronics vs. Shantou Wanshun Package | TongFu Microelectronics vs. Muyuan Foodstuff Co | TongFu Microelectronics vs. Great Sun Foods Co | TongFu Microelectronics vs. Sublime China Information |
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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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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