Correlation Between Tongyu Communication and China Enterprise
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By analyzing existing cross correlation between Tongyu Communication and China Enterprise Co, you can compare the effects of market volatilities on Tongyu Communication and China Enterprise 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 China Enterprise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongyu Communication and China Enterprise.
Diversification Opportunities for Tongyu Communication and China Enterprise
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tongyu and China is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Tongyu Communication and China Enterprise Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Enterprise 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 China Enterprise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Enterprise has no effect on the direction of Tongyu Communication i.e., Tongyu Communication and China Enterprise go up and down completely randomly.
Pair Corralation between Tongyu Communication and China Enterprise
Assuming the 90 days trading horizon Tongyu Communication is expected to generate 1.79 times more return on investment than China Enterprise. However, Tongyu Communication is 1.79 times more volatile than China Enterprise Co. It trades about -0.13 of its potential returns per unit of risk. China Enterprise Co is currently generating about -0.43 per unit of risk. If you would invest 1,561 in Tongyu Communication on October 17, 2024 and sell it today you would lose (147.00) from holding Tongyu Communication or give up 9.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongyu Communication vs. China Enterprise Co
Performance |
| Timeline |
| Tongyu Communication |
| China Enterprise |
Tongyu Communication and China Enterprise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongyu Communication and China Enterprise
The main advantage of trading using opposite Tongyu Communication and China Enterprise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongyu Communication position performs unexpectedly, China Enterprise 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 China Enterprise will offset losses from the drop in China Enterprise's long position.| Tongyu Communication vs. Rising Nonferrous Metals | Tongyu Communication vs. Offshore Oil Engineering | Tongyu Communication vs. Jiangxi Naipu Mining | Tongyu Communication vs. Zhejiang Kingland Pipeline |
| China Enterprise vs. Kangxin New Materials | China Enterprise vs. Long Yuan Construction | China Enterprise vs. Cangzhou Mingzhu Plastic | China Enterprise vs. Hongrun Construction Group |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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