Correlation Between Tianjin Realty and Liaoning Chengda
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By analyzing existing cross correlation between Tianjin Realty Development and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on Tianjin Realty and Liaoning Chengda 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 Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Realty and Liaoning Chengda.
Diversification Opportunities for Tianjin Realty and Liaoning Chengda
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tianjin and Liaoning is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Realty Development and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio 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 Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of Tianjin Realty i.e., Tianjin Realty and Liaoning Chengda go up and down completely randomly.
Pair Corralation between Tianjin Realty and Liaoning Chengda
Assuming the 90 days trading horizon Tianjin Realty Development is expected to generate 4.73 times more return on investment than Liaoning Chengda. However, Tianjin Realty is 4.73 times more volatile than Liaoning Chengda Biotechnology. It trades about 0.0 of its potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about -0.51 per unit of risk. If you would invest 270.00 in Tianjin Realty Development on October 9, 2024 and sell it today you would lose (6.00) from holding Tianjin Realty Development or give up 2.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Realty Development vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| Tianjin Realty Devel |
| Liaoning Chengda Bio |
Tianjin Realty and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Realty and Liaoning Chengda
The main advantage of trading using opposite Tianjin Realty and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Realty position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| Tianjin Realty vs. Hunan TV Broadcast | Tianjin Realty vs. Sichuan Fulin Transportation | Tianjin Realty vs. Xinjiang Beixin RoadBridge | Tianjin Realty vs. Fujian Longzhou Transportation |
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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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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