Correlation Between TTET Union and Kung Long
Can any of the company-specific risk be diversified away by investing in both TTET Union and Kung Long at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining TTET Union and Kung Long into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TTET Union Corp and Kung Long Batteries, you can compare the effects of market volatilities on TTET Union and Kung Long 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 TTET Union with a short position of Kung Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of TTET Union and Kung Long.
Diversification Opportunities for TTET Union and Kung Long
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TTET and Kung is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding TTET Union Corp and Kung Long Batteries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kung Long Batteries and TTET Union 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 TTET Union Corp are associated (or correlated) with Kung Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kung Long Batteries has no effect on the direction of TTET Union i.e., TTET Union and Kung Long go up and down completely randomly.
Pair Corralation between TTET Union and Kung Long
Assuming the 90 days trading horizon TTET Union is expected to generate 6.02 times less return on investment than Kung Long. But when comparing it to its historical volatility, TTET Union Corp is 1.38 times less risky than Kung Long. It trades about 0.01 of its potential returns per unit of risk. Kung Long Batteries is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 13,350 in Kung Long Batteries on August 26, 2024 and sell it today you would earn a total of 1,900 from holding Kung Long Batteries or generate 14.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TTET Union Corp vs. Kung Long Batteries
Performance |
| Timeline |
| TTET Union Corp |
| Kung Long Batteries |
TTET Union and Kung Long Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TTET Union and Kung Long
The main advantage of trading using opposite TTET Union and Kung Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TTET Union position performs unexpectedly, Kung Long 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 Kung Long will offset losses from the drop in Kung Long's long position.| TTET Union vs. Charoen Pokphand Enterprise | TTET Union vs. Standard Foods Corp | TTET Union vs. Uni President Enterprises Corp | TTET Union vs. Great Wall Enterprise |
| Kung Long vs. Sunny Friend Environmental | Kung Long vs. TTET Union Corp | Kung Long vs. ECOVE Environment Corp | Kung Long vs. Yulon Finance Corp |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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