Correlation Between Li Peng and Tex Ray
Can any of the company-specific risk be diversified away by investing in both Li Peng and Tex Ray 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 Li Peng and Tex Ray into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Li Peng Enterprise and Tex Ray Industrial Co, you can compare the effects of market volatilities on Li Peng and Tex Ray 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 Li Peng with a short position of Tex Ray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Li Peng and Tex Ray.
Diversification Opportunities for Li Peng and Tex Ray
Excellent diversification
The 3 months correlation between 1447 and Tex is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Li Peng Enterprise and Tex Ray Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tex Ray Industrial and Li Peng 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 Li Peng Enterprise are associated (or correlated) with Tex Ray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tex Ray Industrial has no effect on the direction of Li Peng i.e., Li Peng and Tex Ray go up and down completely randomly.
Pair Corralation between Li Peng and Tex Ray
Assuming the 90 days trading horizon Li Peng Enterprise is expected to generate 1.52 times more return on investment than Tex Ray. However, Li Peng is 1.52 times more volatile than Tex Ray Industrial Co. It trades about 0.0 of its potential returns per unit of risk. Tex Ray Industrial Co is currently generating about -0.01 per unit of risk. If you would invest 772.00 in Li Peng Enterprise on September 14, 2024 and sell it today you would lose (21.00) from holding Li Peng Enterprise or give up 2.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.62% |
| Values | Daily Returns |
Li Peng Enterprise vs. Tex Ray Industrial Co
Performance |
| Timeline |
| Li Peng Enterprise |
| Tex Ray Industrial |
Li Peng and Tex Ray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Li Peng and Tex Ray
The main advantage of trading using opposite Li Peng and Tex Ray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Li Peng position performs unexpectedly, Tex Ray 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 Tex Ray will offset losses from the drop in Tex Ray's long position.| Li Peng vs. Feng Tay Enterprises | Li Peng vs. Ruentex Development Co | Li Peng vs. WiseChip Semiconductor | Li Peng vs. Novatek Microelectronics Corp |
| Tex Ray vs. Feng Tay Enterprises | Tex Ray vs. Ruentex Development Co | Tex Ray vs. WiseChip Semiconductor | Tex Ray vs. Novatek Microelectronics 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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