Correlation Between Tongyu Communication and Kuang Chi
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By analyzing existing cross correlation between Tongyu Communication and Kuang Chi Technologies, you can compare the effects of market volatilities on Tongyu Communication and Kuang Chi 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 Kuang Chi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongyu Communication and Kuang Chi.
Diversification Opportunities for Tongyu Communication and Kuang Chi
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tongyu and Kuang is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Tongyu Communication and Kuang Chi Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuang Chi Technologies 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 Kuang Chi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuang Chi Technologies has no effect on the direction of Tongyu Communication i.e., Tongyu Communication and Kuang Chi go up and down completely randomly.
Pair Corralation between Tongyu Communication and Kuang Chi
Assuming the 90 days trading horizon Tongyu Communication is expected to generate 1.07 times more return on investment than Kuang Chi. However, Tongyu Communication is 1.07 times more volatile than Kuang Chi Technologies. It trades about 0.07 of its potential returns per unit of risk. Kuang Chi Technologies is currently generating about -0.13 per unit of risk. If you would invest 1,536 in Tongyu Communication on September 15, 2024 and sell it today you would earn a total of 72.00 from holding Tongyu Communication or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongyu Communication vs. Kuang Chi Technologies
Performance |
| Timeline |
| Tongyu Communication |
| Kuang Chi Technologies |
Tongyu Communication and Kuang Chi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongyu Communication and Kuang Chi
The main advantage of trading using opposite Tongyu Communication and Kuang Chi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongyu Communication position performs unexpectedly, Kuang Chi 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 Kuang Chi will offset losses from the drop in Kuang Chi'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 |
| Kuang Chi vs. BeiGene | Kuang Chi vs. Kweichow Moutai Co | Kuang Chi vs. Beijing Roborock Technology | Kuang Chi vs. G bits Network Technology |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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