Correlation Between Tianjin Realty and Loongson Technology
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By analyzing existing cross correlation between Tianjin Realty Development and Loongson Technology Corp, you can compare the effects of market volatilities on Tianjin Realty and Loongson Technology 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 Realty with a short position of Loongson Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Realty and Loongson Technology.
Diversification Opportunities for Tianjin Realty and Loongson Technology
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tianjin and Loongson is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Realty Development and Loongson Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loongson Technology Corp and Tianjin Realty 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 Realty Development are associated (or correlated) with Loongson Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loongson Technology Corp has no effect on the direction of Tianjin Realty i.e., Tianjin Realty and Loongson Technology go up and down completely randomly.
Pair Corralation between Tianjin Realty and Loongson Technology
Assuming the 90 days trading horizon Tianjin Realty Development is expected to under-perform the Loongson Technology. In addition to that, Tianjin Realty is 1.92 times more volatile than Loongson Technology Corp. It trades about -0.23 of its total potential returns per unit of risk. Loongson Technology Corp is currently generating about -0.31 per unit of volatility. If you would invest 14,050 in Loongson Technology Corp on October 28, 2024 and sell it today you would lose (1,987) from holding Loongson Technology Corp or give up 14.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Realty Development vs. Loongson Technology Corp
Performance |
| Timeline |
| Tianjin Realty Devel |
| Loongson Technology Corp |
Tianjin Realty and Loongson Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Realty and Loongson Technology
The main advantage of trading using opposite Tianjin Realty and Loongson Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Realty position performs unexpectedly, Loongson Technology 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 Loongson Technology will offset losses from the drop in Loongson Technology's long position.| Tianjin Realty vs. Allgens Medical Technology | Tianjin Realty vs. Double Medical Technology | Tianjin Realty vs. Yili Chuanning Biotechnology | Tianjin Realty vs. APT Medical |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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