Correlation Between Tex Year and Jinan Acetate
Can any of the company-specific risk be diversified away by investing in both Tex Year and Jinan Acetate at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Tex Year and Jinan Acetate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tex Year Industries and Jinan Acetate Chemical, you can compare the effects of market volatilities on Tex Year and Jinan Acetate 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 Tex Year with a short position of Jinan Acetate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tex Year and Jinan Acetate.
Diversification Opportunities for Tex Year and Jinan Acetate
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tex and Jinan is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Tex Year Industries and Jinan Acetate Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinan Acetate Chemical and Tex Year 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 Tex Year Industries are associated (or correlated) with Jinan Acetate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinan Acetate Chemical has no effect on the direction of Tex Year i.e., Tex Year and Jinan Acetate go up and down completely randomly.
Pair Corralation between Tex Year and Jinan Acetate
Assuming the 90 days trading horizon Tex Year Industries is expected to under-perform the Jinan Acetate. In addition to that, Tex Year is 1.16 times more volatile than Jinan Acetate Chemical. It trades about -0.02 of its total potential returns per unit of risk. Jinan Acetate Chemical is currently generating about 0.08 per unit of volatility. If you would invest 84,200 in Jinan Acetate Chemical on August 30, 2024 and sell it today you would earn a total of 2,200 from holding Jinan Acetate Chemical or generate 2.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tex Year Industries vs. Jinan Acetate Chemical
Performance |
| Timeline |
| Tex Year Industries |
| Jinan Acetate Chemical |
Tex Year and Jinan Acetate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tex Year and Jinan Acetate
The main advantage of trading using opposite Tex Year and Jinan Acetate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tex Year position performs unexpectedly, Jinan Acetate 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 Jinan Acetate will offset losses from the drop in Jinan Acetate's long position.| Tex Year vs. Jinan Acetate Chemical | Tex Year vs. San Fu Chemical | Tex Year vs. Concraft Holding Co | Tex Year vs. Halfords Group PLC |
| Jinan Acetate vs. San Fu Chemical | Jinan Acetate vs. Tex Year Industries | Jinan Acetate vs. Concraft Holding Co | Jinan Acetate vs. Coremax Corp |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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