Correlation Between Contemporary Amperex and TianJin 712
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By analyzing existing cross correlation between Contemporary Amperex Technology and TianJin 712 Communication, you can compare the effects of market volatilities on Contemporary Amperex and TianJin 712 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 Contemporary Amperex with a short position of TianJin 712. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contemporary Amperex and TianJin 712.
Diversification Opportunities for Contemporary Amperex and TianJin 712
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Contemporary and TianJin is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Contemporary Amperex Technolog and TianJin 712 Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TianJin 712 Communication and Contemporary Amperex 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 Contemporary Amperex Technology are associated (or correlated) with TianJin 712. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TianJin 712 Communication has no effect on the direction of Contemporary Amperex i.e., Contemporary Amperex and TianJin 712 go up and down completely randomly.
Pair Corralation between Contemporary Amperex and TianJin 712
Assuming the 90 days trading horizon Contemporary Amperex Technology is expected to generate 0.92 times more return on investment than TianJin 712. However, Contemporary Amperex Technology is 1.09 times less risky than TianJin 712. It trades about 0.07 of its potential returns per unit of risk. TianJin 712 Communication is currently generating about -0.03 per unit of risk. If you would invest 17,598 in Contemporary Amperex Technology on September 15, 2024 and sell it today you would earn a total of 9,105 from holding Contemporary Amperex Technology or generate 51.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Contemporary Amperex Technolog vs. TianJin 712 Communication
Performance |
| Timeline |
| Contemporary Amperex |
| TianJin 712 Communication |
Contemporary Amperex and TianJin 712 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contemporary Amperex and TianJin 712
The main advantage of trading using opposite Contemporary Amperex and TianJin 712 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contemporary Amperex position performs unexpectedly, TianJin 712 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 712 will offset losses from the drop in TianJin 712's long position.| Contemporary Amperex vs. Qinghaihuading Industrial Co | Contemporary Amperex vs. Gem Year Industrial Co | Contemporary Amperex vs. China Nonferrous Metal | Contemporary Amperex vs. Linewell Software Co |
| TianJin 712 vs. Industrial and Commercial | TianJin 712 vs. China Construction Bank | TianJin 712 vs. Bank of China | TianJin 712 vs. Agricultural Bank of |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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