Correlation Between Yingde Greatchem and Tongyu Communication
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By analyzing existing cross correlation between Yingde Greatchem Chemicals and Tongyu Communication, you can compare the effects of market volatilities on Yingde Greatchem 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 Yingde Greatchem with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yingde Greatchem and Tongyu Communication.
Diversification Opportunities for Yingde Greatchem and Tongyu Communication
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Yingde and Tongyu is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Yingde Greatchem Chemicals and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Yingde Greatchem 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 Yingde Greatchem Chemicals 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 Yingde Greatchem i.e., Yingde Greatchem and Tongyu Communication go up and down completely randomly.
Pair Corralation between Yingde Greatchem and Tongyu Communication
Assuming the 90 days trading horizon Yingde Greatchem Chemicals is expected to generate 0.79 times more return on investment than Tongyu Communication. However, Yingde Greatchem Chemicals is 1.26 times less risky than Tongyu Communication. It trades about -0.1 of its potential returns per unit of risk. Tongyu Communication is currently generating about -0.12 per unit of risk. If you would invest 2,545 in Yingde Greatchem Chemicals on October 30, 2024 and sell it today you would lose (220.00) from holding Yingde Greatchem Chemicals or give up 8.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yingde Greatchem Chemicals vs. Tongyu Communication
Performance |
| Timeline |
| Yingde Greatchem Che |
| Tongyu Communication |
Yingde Greatchem and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yingde Greatchem and Tongyu Communication
The main advantage of trading using opposite Yingde Greatchem and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yingde Greatchem 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.| Yingde Greatchem vs. Zijin Mining Group | Yingde Greatchem vs. Wanhua Chemical Group | Yingde Greatchem vs. Baoshan Iron Steel | Yingde Greatchem vs. Shandong Gold Mining |
| Tongyu Communication vs. Bus Online Co | Tongyu Communication vs. Holitech Technology Co | Tongyu Communication vs. Gome Telecom Equipment | Tongyu Communication vs. Cultural Investment Holdings |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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