Correlation Between Jiangxi Hengda and Tongyu Communication
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By analyzing existing cross correlation between Jiangxi Hengda Hi Tech and Tongyu Communication, you can compare the effects of market volatilities on Jiangxi Hengda 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 Jiangxi Hengda with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Hengda and Tongyu Communication.
Diversification Opportunities for Jiangxi Hengda and Tongyu Communication
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangxi and Tongyu is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Hengda Hi Tech and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Jiangxi Hengda 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 Jiangxi Hengda Hi Tech 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 Jiangxi Hengda i.e., Jiangxi Hengda and Tongyu Communication go up and down completely randomly.
Pair Corralation between Jiangxi Hengda and Tongyu Communication
Assuming the 90 days trading horizon Jiangxi Hengda Hi Tech is expected to under-perform the Tongyu Communication. In addition to that, Jiangxi Hengda is 1.47 times more volatile than Tongyu Communication. It trades about -0.09 of its total potential returns per unit of risk. Tongyu Communication is currently generating about -0.12 per unit of volatility. If you would invest 1,653 in Tongyu Communication on October 30, 2024 and sell it today you would lose (222.00) from holding Tongyu Communication or give up 13.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Hengda Hi Tech vs. Tongyu Communication
Performance |
| Timeline |
| Jiangxi Hengda Hi |
| Tongyu Communication |
Jiangxi Hengda and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Hengda and Tongyu Communication
The main advantage of trading using opposite Jiangxi Hengda and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Hengda 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.| Jiangxi Hengda vs. Zijin Mining Group | Jiangxi Hengda vs. Wanhua Chemical Group | Jiangxi Hengda vs. Baoshan Iron Steel | Jiangxi Hengda vs. Shandong Gold Mining |
| Tongyu Communication vs. Bus Online Co | Tongyu Communication vs. Holitech Technology Co | Tongyu Communication vs. Gome Telecom Equipment | Tongyu Communication vs. Cultural Investment Holdings |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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