Correlation Between Gansu Jiu and Tongyu Communication
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By analyzing existing cross correlation between Gansu Jiu Steel and Tongyu Communication, you can compare the effects of market volatilities on Gansu Jiu and Tongyu Communication 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 Gansu Jiu with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Tongyu Communication.
Diversification Opportunities for Gansu Jiu and Tongyu Communication
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gansu and Tongyu is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Gansu Jiu 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 Gansu Jiu Steel are associated (or correlated) with Tongyu Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongyu Communication has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Tongyu Communication go up and down completely randomly.
Pair Corralation between Gansu Jiu and Tongyu Communication
Assuming the 90 days trading horizon Gansu Jiu is expected to generate 11.88 times less return on investment than Tongyu Communication. But when comparing it to its historical volatility, Gansu Jiu Steel is 1.7 times less risky than Tongyu Communication. It trades about 0.0 of its potential returns per unit of risk. Tongyu Communication is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,231 in Tongyu Communication on December 2, 2024 and sell it today you would earn a total of 266.00 from holding Tongyu Communication or generate 21.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gansu Jiu Steel vs. Tongyu Communication
Performance |
| Timeline |
| Gansu Jiu Steel |
| Tongyu Communication |
Gansu Jiu and Tongyu Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Tongyu Communication
The main advantage of trading using opposite Gansu Jiu and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Tongyu Communication 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 Tongyu Communication will offset losses from the drop in Tongyu Communication's long position.| Gansu Jiu vs. Chengdu Spaceon Electronics | Gansu Jiu vs. Zijin Mining Group | Gansu Jiu vs. Shengda Mining Co | Gansu Jiu vs. Tibet Huayu Mining |
| Tongyu Communication vs. HeNan Splendor Science | Tongyu Communication vs. AnShan Heavy Duty | Tongyu Communication vs. Allied Machinery Co | Tongyu Communication vs. China Everbright Bank |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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