Correlation Between Suzhou Industrial and TongFu Microelectronics
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By analyzing existing cross correlation between Suzhou Industrial Park and TongFu Microelectronics Co, you can compare the effects of market volatilities on Suzhou Industrial and TongFu Microelectronics 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 Suzhou Industrial with a short position of TongFu Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Industrial and TongFu Microelectronics.
Diversification Opportunities for Suzhou Industrial and TongFu Microelectronics
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Suzhou and TongFu is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Industrial Park and TongFu Microelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TongFu Microelectronics and Suzhou Industrial 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 Suzhou Industrial Park are associated (or correlated) with TongFu Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TongFu Microelectronics has no effect on the direction of Suzhou Industrial i.e., Suzhou Industrial and TongFu Microelectronics go up and down completely randomly.
Pair Corralation between Suzhou Industrial and TongFu Microelectronics
Assuming the 90 days trading horizon Suzhou Industrial is expected to generate 1.42 times less return on investment than TongFu Microelectronics. In addition to that, Suzhou Industrial is 1.19 times more volatile than TongFu Microelectronics Co. It trades about 0.02 of its total potential returns per unit of risk. TongFu Microelectronics Co is currently generating about 0.03 per unit of volatility. If you would invest 2,289 in TongFu Microelectronics Co on October 29, 2024 and sell it today you would earn a total of 598.00 from holding TongFu Microelectronics Co or generate 26.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Industrial Park vs. TongFu Microelectronics Co
Performance |
| Timeline |
| Suzhou Industrial Park |
| TongFu Microelectronics |
Suzhou Industrial and TongFu Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Industrial and TongFu Microelectronics
The main advantage of trading using opposite Suzhou Industrial and TongFu Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Industrial position performs unexpectedly, TongFu Microelectronics 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 TongFu Microelectronics will offset losses from the drop in TongFu Microelectronics' long position.| Suzhou Industrial vs. Runjian Communication Co | Suzhou Industrial vs. Healthcare Co | Suzhou Industrial vs. Tianjin Hi Tech Development | Suzhou Industrial vs. Meinian Onehealth Healthcare |
| TongFu Microelectronics vs. Ligao Foods CoLtd | TongFu Microelectronics vs. Sichuan Hebang Biotechnology | TongFu Microelectronics vs. Fujian Anjoy Foods | TongFu Microelectronics vs. Guilin Seamild Foods |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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