Correlation Between TongFu Microelectronics and Joincare Pharmaceutical
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By analyzing existing cross correlation between TongFu Microelectronics Co and Joincare Pharmaceutical Group, you can compare the effects of market volatilities on TongFu Microelectronics and Joincare Pharmaceutical 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 Joincare Pharmaceutical. Check out your portfolio center. Please also check ongoing floating volatility patterns of TongFu Microelectronics and Joincare Pharmaceutical.
Diversification Opportunities for TongFu Microelectronics and Joincare Pharmaceutical
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TongFu and Joincare is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding TongFu Microelectronics Co and Joincare Pharmaceutical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joincare Pharmaceutical 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 Joincare Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joincare Pharmaceutical has no effect on the direction of TongFu Microelectronics i.e., TongFu Microelectronics and Joincare Pharmaceutical go up and down completely randomly.
Pair Corralation between TongFu Microelectronics and Joincare Pharmaceutical
Assuming the 90 days trading horizon TongFu Microelectronics Co is expected to generate 2.64 times more return on investment than Joincare Pharmaceutical. However, TongFu Microelectronics is 2.64 times more volatile than Joincare Pharmaceutical Group. It trades about -0.03 of its potential returns per unit of risk. Joincare Pharmaceutical Group is currently generating about -0.19 per unit of risk. If you would invest 2,987 in TongFu Microelectronics Co on October 25, 2024 and sell it today you would lose (100.00) from holding TongFu Microelectronics Co or give up 3.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
TongFu Microelectronics Co vs. Joincare Pharmaceutical Group
Performance |
| Timeline |
| TongFu Microelectronics |
| Joincare Pharmaceutical |
TongFu Microelectronics and Joincare Pharmaceutical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TongFu Microelectronics and Joincare Pharmaceutical
The main advantage of trading using opposite TongFu Microelectronics and Joincare Pharmaceutical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TongFu Microelectronics position performs unexpectedly, Joincare Pharmaceutical 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 Joincare Pharmaceutical will offset losses from the drop in Joincare Pharmaceutical's long position.| TongFu Microelectronics vs. Kweichow Moutai Co | TongFu Microelectronics vs. NAURA Technology Group | TongFu Microelectronics vs. APT Medical | TongFu Microelectronics vs. BYD Co Ltd |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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