Correlation Between Tianjin LVYIN and Dongguan Aohai
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By analyzing existing cross correlation between Tianjin LVYIN Landscape and Dongguan Aohai Technology, you can compare the effects of market volatilities on Tianjin LVYIN and Dongguan Aohai 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 Tianjin LVYIN with a short position of Dongguan Aohai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin LVYIN and Dongguan Aohai.
Diversification Opportunities for Tianjin LVYIN and Dongguan Aohai
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tianjin and Dongguan is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin LVYIN Landscape and Dongguan Aohai Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Aohai Technology and Tianjin LVYIN 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 Tianjin LVYIN Landscape are associated (or correlated) with Dongguan Aohai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Aohai Technology has no effect on the direction of Tianjin LVYIN i.e., Tianjin LVYIN and Dongguan Aohai go up and down completely randomly.
Pair Corralation between Tianjin LVYIN and Dongguan Aohai
Assuming the 90 days trading horizon Tianjin LVYIN Landscape is expected to under-perform the Dongguan Aohai. But the stock apears to be less risky and, when comparing its historical volatility, Tianjin LVYIN Landscape is 1.23 times less risky than Dongguan Aohai. The stock trades about -0.05 of its potential returns per unit of risk. The Dongguan Aohai Technology is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3,251 in Dongguan Aohai Technology on September 27, 2024 and sell it today you would earn a total of 801.00 from holding Dongguan Aohai Technology or generate 24.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin LVYIN Landscape vs. Dongguan Aohai Technology
Performance |
| Timeline |
| Tianjin LVYIN Landscape |
| Dongguan Aohai Technology |
Tianjin LVYIN and Dongguan Aohai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin LVYIN and Dongguan Aohai
The main advantage of trading using opposite Tianjin LVYIN and Dongguan Aohai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin LVYIN position performs unexpectedly, Dongguan Aohai 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 Dongguan Aohai will offset losses from the drop in Dongguan Aohai's long position.| Tianjin LVYIN vs. Dongguan Aohai Technology | Tianjin LVYIN vs. Vohringer Home Technology | Tianjin LVYIN vs. Hoshine Silicon Ind | Tianjin LVYIN vs. Der International Home |
| Dongguan Aohai vs. Pengxin International Mining | Dongguan Aohai vs. Guocheng Mining Co | Dongguan Aohai vs. Zhangjiagang Freetrade Science | Dongguan Aohai vs. Chongqing Changan Automobile |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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