Correlation Between Tongxing Environmental and China Publishing
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By analyzing existing cross correlation between Tongxing Environmental Protection and China Publishing Media, you can compare the effects of market volatilities on Tongxing Environmental and China Publishing 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 Tongxing Environmental with a short position of China Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongxing Environmental and China Publishing.
Diversification Opportunities for Tongxing Environmental and China Publishing
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tongxing and China is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Tongxing Environmental Protect and China Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Publishing Media and Tongxing Environmental 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 Tongxing Environmental Protection are associated (or correlated) with China Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Publishing Media has no effect on the direction of Tongxing Environmental i.e., Tongxing Environmental and China Publishing go up and down completely randomly.
Pair Corralation between Tongxing Environmental and China Publishing
Assuming the 90 days trading horizon Tongxing Environmental Protection is expected to generate 1.59 times more return on investment than China Publishing. However, Tongxing Environmental is 1.59 times more volatile than China Publishing Media. It trades about -0.13 of its potential returns per unit of risk. China Publishing Media is currently generating about -0.33 per unit of risk. If you would invest 1,608 in Tongxing Environmental Protection on October 18, 2024 and sell it today you would lose (163.00) from holding Tongxing Environmental Protection or give up 10.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongxing Environmental Protect vs. China Publishing Media
Performance |
| Timeline |
| Tongxing Environmental |
| China Publishing Media |
Tongxing Environmental and China Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongxing Environmental and China Publishing
The main advantage of trading using opposite Tongxing Environmental and China Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongxing Environmental position performs unexpectedly, China Publishing 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 Publishing will offset losses from the drop in China Publishing's long position.| Tongxing Environmental vs. Shenzhen MYS Environmental | Tongxing Environmental vs. AVIC Fund Management | Tongxing Environmental vs. Rongan Property Co | Tongxing Environmental vs. Haoxiangni Jujube Co |
| China Publishing vs. Yindu Kitchen Equipment | China Publishing vs. Jiangsu Yueda Investment | China Publishing vs. Hubei Geoway Investment | China Publishing vs. Beijing Mainstreets 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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