Correlation Between Songz Automobile and Tongyu Communication
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By analyzing existing cross correlation between Songz Automobile Air and Tongyu Communication, you can compare the effects of market volatilities on Songz Automobile and Tongyu Communication 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 Songz Automobile with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songz Automobile and Tongyu Communication.
Diversification Opportunities for Songz Automobile and Tongyu Communication
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Songz and Tongyu is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Songz Automobile Air and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Songz Automobile 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 Songz Automobile Air are associated (or correlated) with Tongyu Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongyu Communication has no effect on the direction of Songz Automobile i.e., Songz Automobile and Tongyu Communication go up and down completely randomly.
Pair Corralation between Songz Automobile and Tongyu Communication
Assuming the 90 days trading horizon Songz Automobile is expected to generate 12.84 times less return on investment than Tongyu Communication. But when comparing it to its historical volatility, Songz Automobile Air is 1.58 times less risky than Tongyu Communication. It trades about 0.01 of its potential returns per unit of risk. Tongyu Communication is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 849.00 in Tongyu Communication on September 3, 2024 and sell it today you would earn a total of 804.00 from holding Tongyu Communication or generate 94.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Songz Automobile Air vs. Tongyu Communication
Performance |
| Timeline |
| Songz Automobile Air |
| Tongyu Communication |
Songz Automobile and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songz Automobile and Tongyu Communication
The main advantage of trading using opposite Songz Automobile and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songz Automobile position performs unexpectedly, Tongyu Communication 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 Tongyu Communication will offset losses from the drop in Tongyu Communication's long position.| Songz Automobile vs. PetroChina Co Ltd | Songz Automobile vs. China Mobile Limited | Songz Automobile vs. Industrial and Commercial | Songz Automobile vs. China Life Insurance |
| Tongyu Communication vs. Agricultural Bank of | Tongyu Communication vs. China Construction Bank | Tongyu Communication vs. Postal Savings Bank | Tongyu Communication vs. Bank of Communications |
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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