Correlation Between Shenzhen and Tianjin Hi
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By analyzing existing cross correlation between Shenzhen AV Display Co and Tianjin Hi Tech Development, you can compare the effects of market volatilities on Shenzhen and Tianjin Hi 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 Shenzhen with a short position of Tianjin Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen and Tianjin Hi.
Diversification Opportunities for Shenzhen and Tianjin Hi
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Tianjin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen AV Display Co and Tianjin Hi Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Hi Tech and Shenzhen 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 Shenzhen AV Display Co are associated (or correlated) with Tianjin Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Hi Tech has no effect on the direction of Shenzhen i.e., Shenzhen and Tianjin Hi go up and down completely randomly.
Pair Corralation between Shenzhen and Tianjin Hi
Assuming the 90 days trading horizon Shenzhen AV Display Co is expected to generate 1.24 times more return on investment than Tianjin Hi. However, Shenzhen is 1.24 times more volatile than Tianjin Hi Tech Development. It trades about 0.13 of its potential returns per unit of risk. Tianjin Hi Tech Development is currently generating about 0.1 per unit of risk. If you would invest 3,131 in Shenzhen AV Display Co on September 1, 2024 and sell it today you would earn a total of 296.00 from holding Shenzhen AV Display Co or generate 9.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen AV Display Co vs. Tianjin Hi Tech Development
Performance |
| Timeline |
| Shenzhen AV Display |
| Tianjin Hi Tech |
Shenzhen and Tianjin Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen and Tianjin Hi
The main advantage of trading using opposite Shenzhen and Tianjin Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen position performs unexpectedly, Tianjin Hi 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 Hi will offset losses from the drop in Tianjin Hi's long position.| Shenzhen vs. Western Superconducting Tech | Shenzhen vs. Tianshui Huatian Technology | Shenzhen vs. Nanjing Putian Telecommunications | Shenzhen vs. Guangdong Shenglu Telecommunication |
| Tianjin Hi vs. Cultural Investment Holdings | Tianjin Hi vs. Gome Telecom Equipment | Tianjin Hi vs. Bus Online Co | Tianjin Hi vs. Zotye Automobile Co |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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