Correlation Between Konfoong Materials and Tongyu Communication
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By analyzing existing cross correlation between Konfoong Materials International and Tongyu Communication, you can compare the effects of market volatilities on Konfoong Materials and Tongyu Communication 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 Konfoong Materials with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konfoong Materials and Tongyu Communication.
Diversification Opportunities for Konfoong Materials and Tongyu Communication
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Konfoong and Tongyu is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Konfoong Materials Internation and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Konfoong Materials 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 Konfoong Materials International are associated (or correlated) with Tongyu Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongyu Communication has no effect on the direction of Konfoong Materials i.e., Konfoong Materials and Tongyu Communication go up and down completely randomly.
Pair Corralation between Konfoong Materials and Tongyu Communication
Assuming the 90 days trading horizon Konfoong Materials is expected to generate 8.24 times less return on investment than Tongyu Communication. But when comparing it to its historical volatility, Konfoong Materials International is 1.21 times less risky than Tongyu Communication. It trades about 0.01 of its potential returns per unit of risk. Tongyu Communication is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 881.00 in Tongyu Communication on October 11, 2024 and sell it today you would earn a total of 501.00 from holding Tongyu Communication or generate 56.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Konfoong Materials Internation vs. Tongyu Communication
Performance |
| Timeline |
| Konfoong Materials |
| Tongyu Communication |
Konfoong Materials and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Konfoong Materials and Tongyu Communication
The main advantage of trading using opposite Konfoong Materials and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konfoong Materials position performs unexpectedly, Tongyu Communication 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 Tongyu Communication will offset losses from the drop in Tongyu Communication's long position.| Konfoong Materials vs. Sinofibers Technology Co | Konfoong Materials vs. Miracll Chemicals Co | Konfoong Materials vs. Xizi Clean Energy | Konfoong Materials vs. Jinhe Biotechnology Co |
| Tongyu Communication vs. Emdoor Information Co | Tongyu Communication vs. Konfoong Materials International | Tongyu Communication vs. Sanxiang Advanced Materials | Tongyu Communication vs. Keda Clean Energy |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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