Correlation Between Hubei Forbon and Tianjin Ruixin
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By analyzing existing cross correlation between Hubei Forbon Technology and Tianjin Ruixin Technology, you can compare the effects of market volatilities on Hubei Forbon and Tianjin Ruixin 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 Hubei Forbon with a short position of Tianjin Ruixin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Forbon and Tianjin Ruixin.
Diversification Opportunities for Hubei Forbon and Tianjin Ruixin
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hubei and Tianjin is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Forbon Technology and Tianjin Ruixin Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Ruixin Technology and Hubei Forbon 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 Hubei Forbon Technology are associated (or correlated) with Tianjin Ruixin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Ruixin Technology has no effect on the direction of Hubei Forbon i.e., Hubei Forbon and Tianjin Ruixin go up and down completely randomly.
Pair Corralation between Hubei Forbon and Tianjin Ruixin
Assuming the 90 days trading horizon Hubei Forbon is expected to generate 1.11 times less return on investment than Tianjin Ruixin. But when comparing it to its historical volatility, Hubei Forbon Technology is 1.25 times less risky than Tianjin Ruixin. It trades about 0.02 of its potential returns per unit of risk. Tianjin Ruixin Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,468 in Tianjin Ruixin Technology on November 2, 2024 and sell it today you would lose (19.00) from holding Tianjin Ruixin Technology or give up 1.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Forbon Technology vs. Tianjin Ruixin Technology
Performance |
| Timeline |
| Hubei Forbon Technology |
| Tianjin Ruixin Technology |
Hubei Forbon and Tianjin Ruixin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Forbon and Tianjin Ruixin
The main advantage of trading using opposite Hubei Forbon and Tianjin Ruixin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Forbon position performs unexpectedly, Tianjin Ruixin 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 Tianjin Ruixin will offset losses from the drop in Tianjin Ruixin's long position.| Hubei Forbon vs. Spring Airlines Co | Hubei Forbon vs. Xiandai Investment Co | Hubei Forbon vs. GRIPM Advanced Materials | Hubei Forbon vs. Beijing Mainstreets Investment |
| Tianjin Ruixin vs. Air China Ltd | Tianjin Ruixin vs. Nanjing Putian Telecommunications | Tianjin Ruixin vs. Youyou Foods Co | Tianjin Ruixin vs. Quectel Wireless Solutions |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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