Correlation Between Tianjin Hi and Sunwave Communications
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By analyzing existing cross correlation between Tianjin Hi Tech Development and Sunwave Communications Co, you can compare the effects of market volatilities on Tianjin Hi and Sunwave Communications 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 Tianjin Hi with a short position of Sunwave Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Hi and Sunwave Communications.
Diversification Opportunities for Tianjin Hi and Sunwave Communications
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tianjin and Sunwave is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Hi Tech Development and Sunwave Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunwave Communications and Tianjin Hi 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 Tianjin Hi Tech Development are associated (or correlated) with Sunwave Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunwave Communications has no effect on the direction of Tianjin Hi i.e., Tianjin Hi and Sunwave Communications go up and down completely randomly.
Pair Corralation between Tianjin Hi and Sunwave Communications
Assuming the 90 days trading horizon Tianjin Hi Tech Development is expected to under-perform the Sunwave Communications. But the stock apears to be less risky and, when comparing its historical volatility, Tianjin Hi Tech Development is 1.22 times less risky than Sunwave Communications. The stock trades about 0.0 of its potential returns per unit of risk. The Sunwave Communications Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 488.00 in Sunwave Communications Co on August 29, 2024 and sell it today you would earn a total of 177.00 from holding Sunwave Communications Co or generate 36.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Hi Tech Development vs. Sunwave Communications Co
Performance |
| Timeline |
| Tianjin Hi Tech |
| Sunwave Communications |
Tianjin Hi and Sunwave Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Hi and Sunwave Communications
The main advantage of trading using opposite Tianjin Hi and Sunwave Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Hi position performs unexpectedly, Sunwave Communications 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 Sunwave Communications will offset losses from the drop in Sunwave Communications' long position.| Tianjin Hi vs. China State Construction | Tianjin Hi vs. Huafa Industrial Co | Tianjin Hi vs. China International Capital | Tianjin Hi vs. Kweichow Moutai 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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