Correlation Between Fujian Nanwang and Tianjin Capital
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By analyzing existing cross correlation between Fujian Nanwang Environment and Tianjin Capital Environmental, you can compare the effects of market volatilities on Fujian Nanwang and Tianjin Capital 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 Fujian Nanwang with a short position of Tianjin Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Nanwang and Tianjin Capital.
Diversification Opportunities for Fujian Nanwang and Tianjin Capital
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Tianjin is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Nanwang Environment and Tianjin Capital Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Capital Envi and Fujian Nanwang 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 Fujian Nanwang Environment are associated (or correlated) with Tianjin Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Capital Envi has no effect on the direction of Fujian Nanwang i.e., Fujian Nanwang and Tianjin Capital go up and down completely randomly.
Pair Corralation between Fujian Nanwang and Tianjin Capital
Assuming the 90 days trading horizon Fujian Nanwang Environment is expected to generate 1.16 times more return on investment than Tianjin Capital. However, Fujian Nanwang is 1.16 times more volatile than Tianjin Capital Environmental. It trades about 0.12 of its potential returns per unit of risk. Tianjin Capital Environmental is currently generating about 0.03 per unit of risk. If you would invest 1,192 in Fujian Nanwang Environment on September 1, 2024 and sell it today you would earn a total of 50.00 from holding Fujian Nanwang Environment or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Nanwang Environment vs. Tianjin Capital Environmental
Performance |
| Timeline |
| Fujian Nanwang Envir |
| Tianjin Capital Envi |
Fujian Nanwang and Tianjin Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Nanwang and Tianjin Capital
The main advantage of trading using opposite Fujian Nanwang and Tianjin Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Nanwang position performs unexpectedly, Tianjin Capital 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 Capital will offset losses from the drop in Tianjin Capital's long position.| Fujian Nanwang vs. Zijin Mining Group | Fujian Nanwang vs. Wanhua Chemical Group | Fujian Nanwang vs. Baoshan Iron Steel | Fujian Nanwang vs. Shandong Gold Mining |
| Tianjin Capital vs. Bank of China | Tianjin Capital vs. Kweichow Moutai Co | Tianjin Capital vs. PetroChina Co Ltd | Tianjin Capital vs. Bank of Communications |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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