Correlation Between Tongyu Communication and Fujian Rongji
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By analyzing existing cross correlation between Tongyu Communication and Fujian Rongji Software, you can compare the effects of market volatilities on Tongyu Communication and Fujian Rongji 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 Tongyu Communication with a short position of Fujian Rongji. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongyu Communication and Fujian Rongji.
Diversification Opportunities for Tongyu Communication and Fujian Rongji
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tongyu and Fujian is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Tongyu Communication and Fujian Rongji Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Rongji Software and Tongyu Communication 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 Tongyu Communication are associated (or correlated) with Fujian Rongji. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Rongji Software has no effect on the direction of Tongyu Communication i.e., Tongyu Communication and Fujian Rongji go up and down completely randomly.
Pair Corralation between Tongyu Communication and Fujian Rongji
Assuming the 90 days trading horizon Tongyu Communication is expected to generate 1.13 times more return on investment than Fujian Rongji. However, Tongyu Communication is 1.13 times more volatile than Fujian Rongji Software. It trades about 0.24 of its potential returns per unit of risk. Fujian Rongji Software is currently generating about 0.15 per unit of risk. If you would invest 1,331 in Tongyu Communication on September 4, 2024 and sell it today you would earn a total of 355.00 from holding Tongyu Communication or generate 26.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongyu Communication vs. Fujian Rongji Software
Performance |
| Timeline |
| Tongyu Communication |
| Fujian Rongji Software |
Tongyu Communication and Fujian Rongji Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongyu Communication and Fujian Rongji
The main advantage of trading using opposite Tongyu Communication and Fujian Rongji positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongyu Communication position performs unexpectedly, Fujian Rongji 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 Fujian Rongji will offset losses from the drop in Fujian Rongji's long position.| Tongyu Communication vs. Industrial and Commercial | Tongyu Communication vs. China Construction Bank | Tongyu Communication vs. Bank of China | Tongyu Communication vs. Agricultural Bank of |
| Fujian Rongji vs. New China Life | Fujian Rongji vs. Ming Yang Smart | Fujian Rongji vs. 159681 | Fujian Rongji vs. 159005 |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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