Correlation Between Kunyue Development and Tacheng Real
Can any of the company-specific risk be diversified away by investing in both Kunyue Development and Tacheng Real 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 Kunyue Development and Tacheng Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kunyue Development Co and Tacheng Real Estate, you can compare the effects of market volatilities on Kunyue Development and Tacheng Real 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 Kunyue Development with a short position of Tacheng Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kunyue Development and Tacheng Real.
Diversification Opportunities for Kunyue Development and Tacheng Real
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kunyue and Tacheng is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kunyue Development Co and Tacheng Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tacheng Real Estate and Kunyue Development 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 Kunyue Development Co are associated (or correlated) with Tacheng Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tacheng Real Estate has no effect on the direction of Kunyue Development i.e., Kunyue Development and Tacheng Real go up and down completely randomly.
Pair Corralation between Kunyue Development and Tacheng Real
Assuming the 90 days trading horizon Kunyue Development Co is expected to generate 1.13 times more return on investment than Tacheng Real. However, Kunyue Development is 1.13 times more volatile than Tacheng Real Estate. It trades about 0.54 of its potential returns per unit of risk. Tacheng Real Estate is currently generating about 0.5 per unit of risk. If you would invest 4,130 in Kunyue Development Co on November 28, 2024 and sell it today you would earn a total of 595.00 from holding Kunyue Development Co or generate 14.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kunyue Development Co vs. Tacheng Real Estate
Performance |
| Timeline |
| Kunyue Development |
| Tacheng Real Estate |
Kunyue Development and Tacheng Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kunyue Development and Tacheng Real
The main advantage of trading using opposite Kunyue Development and Tacheng Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kunyue Development position performs unexpectedly, Tacheng Real 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 Tacheng Real will offset losses from the drop in Tacheng Real's long position.| Kunyue Development vs. Great China Metal | Kunyue Development vs. PChome Online | Kunyue Development vs. CHINA DEVELOPMENT FINANCIAL | Kunyue Development vs. Sports Gear Co |
| Tacheng Real vs. Highwealth Construction Corp | Tacheng Real vs. Sakura Development Co | Tacheng Real vs. Shin Ruenn Development | Tacheng Real vs. Kunyue Development 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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