Correlation Between Tjk Machinery and Suzhou Douson
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By analyzing existing cross correlation between Tjk Machinery Tianjin and Suzhou Douson Drilling, you can compare the effects of market volatilities on Tjk Machinery and Suzhou Douson 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 Tjk Machinery with a short position of Suzhou Douson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tjk Machinery and Suzhou Douson.
Diversification Opportunities for Tjk Machinery and Suzhou Douson
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tjk and Suzhou is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Tjk Machinery Tianjin and Suzhou Douson Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Douson Drilling and Tjk Machinery 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 Tjk Machinery Tianjin are associated (or correlated) with Suzhou Douson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Douson Drilling has no effect on the direction of Tjk Machinery i.e., Tjk Machinery and Suzhou Douson go up and down completely randomly.
Pair Corralation between Tjk Machinery and Suzhou Douson
Assuming the 90 days trading horizon Tjk Machinery is expected to generate 1.28 times less return on investment than Suzhou Douson. But when comparing it to its historical volatility, Tjk Machinery Tianjin is 1.13 times less risky than Suzhou Douson. It trades about 0.16 of its potential returns per unit of risk. Suzhou Douson Drilling is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,942 in Suzhou Douson Drilling on August 25, 2024 and sell it today you would earn a total of 298.00 from holding Suzhou Douson Drilling or generate 15.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tjk Machinery Tianjin vs. Suzhou Douson Drilling
Performance |
| Timeline |
| Tjk Machinery Tianjin |
| Suzhou Douson Drilling |
Tjk Machinery and Suzhou Douson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tjk Machinery and Suzhou Douson
The main advantage of trading using opposite Tjk Machinery and Suzhou Douson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tjk Machinery position performs unexpectedly, Suzhou Douson 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 Suzhou Douson will offset losses from the drop in Suzhou Douson's long position.| Tjk Machinery vs. Biwin Storage Technology | Tjk Machinery vs. PetroChina Co Ltd | Tjk Machinery vs. Industrial and Commercial | Tjk Machinery vs. China Construction Bank |
| Suzhou Douson vs. Guangzhou Jinyi Media | Suzhou Douson vs. Zhejiang Daily Media | Suzhou Douson vs. Qinghaihuading Industrial Co | Suzhou Douson vs. Chengtun Mining 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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