Correlation Between Aba Chemicals and TS Communications
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By analyzing existing cross correlation between Aba Chemicals Corp and TS Communications Co, you can compare the effects of market volatilities on Aba Chemicals and TS Communications 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 Aba Chemicals with a short position of TS Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and TS Communications.
Diversification Opportunities for Aba Chemicals and TS Communications
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aba and 300570 is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and TS Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TS Communications and Aba Chemicals 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 Aba Chemicals Corp are associated (or correlated) with TS Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TS Communications has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and TS Communications go up and down completely randomly.
Pair Corralation between Aba Chemicals and TS Communications
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to under-perform the TS Communications. But the stock apears to be less risky and, when comparing its historical volatility, Aba Chemicals Corp is 1.44 times less risky than TS Communications. The stock trades about -0.01 of its potential returns per unit of risk. The TS Communications Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,379 in TS Communications Co on September 12, 2024 and sell it today you would earn a total of 5,186 from holding TS Communications Co or generate 376.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. TS Communications Co
Performance |
| Timeline |
| Aba Chemicals Corp |
| TS Communications |
Aba Chemicals and TS Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and TS Communications
The main advantage of trading using opposite Aba Chemicals and TS Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, TS Communications 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 TS Communications will offset losses from the drop in TS Communications' long position.| Aba Chemicals vs. Semiconductor Manufacturing Electronics | Aba Chemicals vs. GigaDevice SemiconductorBeiji | Aba Chemicals vs. Qinghaihuading Industrial Co | Aba Chemicals vs. MayAir Technology Co |
| TS Communications vs. Gansu Jiu Steel | TS Communications vs. Shandong Mining Machinery | TS Communications vs. Aba Chemicals Corp | TS Communications vs. BlueFocus Communication Group |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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