Correlation Between Runjian Communication and Tieling Newcity
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By analyzing existing cross correlation between Runjian Communication Co and Tieling Newcity Investment, you can compare the effects of market volatilities on Runjian Communication and Tieling Newcity 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 Runjian Communication with a short position of Tieling Newcity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Runjian Communication and Tieling Newcity.
Diversification Opportunities for Runjian Communication and Tieling Newcity
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Runjian and Tieling is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Runjian Communication Co and Tieling Newcity Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tieling Newcity Inve and Runjian 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 Runjian Communication Co are associated (or correlated) with Tieling Newcity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tieling Newcity Inve has no effect on the direction of Runjian Communication i.e., Runjian Communication and Tieling Newcity go up and down completely randomly.
Pair Corralation between Runjian Communication and Tieling Newcity
Assuming the 90 days trading horizon Runjian Communication Co is expected to generate 1.36 times more return on investment than Tieling Newcity. However, Runjian Communication is 1.36 times more volatile than Tieling Newcity Investment. It trades about 0.23 of its potential returns per unit of risk. Tieling Newcity Investment is currently generating about -0.22 per unit of risk. If you would invest 3,050 in Runjian Communication Co on November 8, 2024 and sell it today you would earn a total of 284.00 from holding Runjian Communication Co or generate 9.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.12% |
| Values | Daily Returns |
Runjian Communication Co vs. Tieling Newcity Investment
Performance |
| Timeline |
| Runjian Communication |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Tieling Newcity Inve |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Runjian Communication and Tieling Newcity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Runjian Communication and Tieling Newcity
The main advantage of trading using opposite Runjian Communication and Tieling Newcity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Runjian Communication position performs unexpectedly, Tieling Newcity 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 Tieling Newcity will offset losses from the drop in Tieling Newcity's long position.The idea behind Runjian Communication Co and Tieling Newcity Investment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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