Correlation Between Ligao Foods and Tianjin Realty
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By analyzing existing cross correlation between Ligao Foods CoLtd and Tianjin Realty Development, you can compare the effects of market volatilities on Ligao Foods and Tianjin Realty 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 Ligao Foods with a short position of Tianjin Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ligao Foods and Tianjin Realty.
Diversification Opportunities for Ligao Foods and Tianjin Realty
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ligao and Tianjin is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ligao Foods CoLtd and Tianjin Realty Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Realty Devel and Ligao Foods 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 Ligao Foods CoLtd are associated (or correlated) with Tianjin Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Realty Devel has no effect on the direction of Ligao Foods i.e., Ligao Foods and Tianjin Realty go up and down completely randomly.
Pair Corralation between Ligao Foods and Tianjin Realty
Assuming the 90 days trading horizon Ligao Foods CoLtd is expected to generate 0.69 times more return on investment than Tianjin Realty. However, Ligao Foods CoLtd is 1.45 times less risky than Tianjin Realty. It trades about -0.28 of its potential returns per unit of risk. Tianjin Realty Development is currently generating about -0.35 per unit of risk. If you would invest 4,300 in Ligao Foods CoLtd on October 16, 2024 and sell it today you would lose (721.00) from holding Ligao Foods CoLtd or give up 16.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ligao Foods CoLtd vs. Tianjin Realty Development
Performance |
| Timeline |
| Ligao Foods CoLtd |
| Tianjin Realty Devel |
Ligao Foods and Tianjin Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ligao Foods and Tianjin Realty
The main advantage of trading using opposite Ligao Foods and Tianjin Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ligao Foods position performs unexpectedly, Tianjin Realty 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 Realty will offset losses from the drop in Tianjin Realty's long position.| Ligao Foods vs. Anji Foodstuff Co | Ligao Foods vs. Shantou Wanshun Package | Ligao Foods vs. Guilin Seamild Foods | Ligao Foods vs. Jiangsu Xinri E Vehicle |
| Tianjin Realty vs. Ligao Foods CoLtd | Tianjin Realty vs. Bohai Leasing Co | Tianjin Realty vs. Youyou Foods Co | Tianjin Realty vs. Jiangnan Mould Plastic |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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