Correlation Between Tianjin Hi and Guangdong Shenglu
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By analyzing existing cross correlation between Tianjin Hi Tech Development and Guangdong Shenglu Telecommunication, you can compare the effects of market volatilities on Tianjin Hi and Guangdong Shenglu 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 Guangdong Shenglu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Hi and Guangdong Shenglu.
Diversification Opportunities for Tianjin Hi and Guangdong Shenglu
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tianjin and Guangdong is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Hi Tech Development and Guangdong Shenglu Telecommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Shenglu 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 Guangdong Shenglu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Shenglu has no effect on the direction of Tianjin Hi i.e., Tianjin Hi and Guangdong Shenglu go up and down completely randomly.
Pair Corralation between Tianjin Hi and Guangdong Shenglu
Assuming the 90 days trading horizon Tianjin Hi Tech Development is expected to generate 0.92 times more return on investment than Guangdong Shenglu. However, Tianjin Hi Tech Development is 1.09 times less risky than Guangdong Shenglu. It trades about 0.1 of its potential returns per unit of risk. Guangdong Shenglu Telecommunication is currently generating about 0.04 per unit of risk. If you would invest 288.00 in Tianjin Hi Tech Development on September 1, 2024 and sell it today you would earn a total of 17.00 from holding Tianjin Hi Tech Development or generate 5.9% 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. Guangdong Shenglu Telecommunic
Performance |
| Timeline |
| Tianjin Hi Tech |
| Guangdong Shenglu |
Tianjin Hi and Guangdong Shenglu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Hi and Guangdong Shenglu
The main advantage of trading using opposite Tianjin Hi and Guangdong Shenglu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Hi position performs unexpectedly, Guangdong Shenglu 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 Guangdong Shenglu will offset losses from the drop in Guangdong Shenglu's long position.| Tianjin Hi vs. Cultural Investment Holdings | Tianjin Hi vs. Gome Telecom Equipment | Tianjin Hi vs. Bus Online Co | Tianjin Hi vs. Zotye Automobile Co |
| Guangdong Shenglu vs. Guocheng Mining Co | Guangdong Shenglu vs. Beijing SPC Environment | Guangdong Shenglu vs. Uroica Mining Safety | Guangdong Shenglu vs. Tongxing Environmental Protection |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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