Correlation Between Tainet Communication and Yulon Finance
Can any of the company-specific risk be diversified away by investing in both Tainet Communication and Yulon Finance 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 Tainet Communication and Yulon Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tainet Communication System and Yulon Finance Corp, you can compare the effects of market volatilities on Tainet Communication and Yulon Finance 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 Tainet Communication with a short position of Yulon Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tainet Communication and Yulon Finance.
Diversification Opportunities for Tainet Communication and Yulon Finance
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tainet and Yulon is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Tainet Communication System and Yulon Finance Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yulon Finance Corp and Tainet Communication 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 Tainet Communication System are associated (or correlated) with Yulon Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yulon Finance Corp has no effect on the direction of Tainet Communication i.e., Tainet Communication and Yulon Finance go up and down completely randomly.
Pair Corralation between Tainet Communication and Yulon Finance
Assuming the 90 days trading horizon Tainet Communication System is expected to generate 8.92 times more return on investment than Yulon Finance. However, Tainet Communication is 8.92 times more volatile than Yulon Finance Corp. It trades about 0.05 of its potential returns per unit of risk. Yulon Finance Corp is currently generating about 0.02 per unit of risk. If you would invest 5,220 in Tainet Communication System on August 31, 2024 and sell it today you would earn a total of 2,750 from holding Tainet Communication System or generate 52.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tainet Communication System vs. Yulon Finance Corp
Performance |
| Timeline |
| Tainet Communication |
| Yulon Finance Corp |
Tainet Communication and Yulon Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tainet Communication and Yulon Finance
The main advantage of trading using opposite Tainet Communication and Yulon Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tainet Communication position performs unexpectedly, Yulon Finance 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 Yulon Finance will offset losses from the drop in Yulon Finance's long position.| Tainet Communication vs. Union Insurance Co | Tainet Communication vs. Mercuries Life Insurance | Tainet Communication vs. Evermore Chemical Industry | Tainet Communication vs. Central Reinsurance Corp |
| Yulon Finance vs. Chailease Holding Co | Yulon Finance vs. Yulon Finance Corp | Yulon Finance vs. Pou Chen Corp | Yulon Finance vs. Ruentex Industries |
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 CEOs Directory module to screen CEOs from public companies around the world.
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