Correlation Between Tsingtao Brewery and Fiberhome Telecommunicatio
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By analyzing existing cross correlation between Tsingtao Brewery Co and Fiberhome Telecommunication Technologies, you can compare the effects of market volatilities on Tsingtao Brewery and Fiberhome Telecommunicatio 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 Tsingtao Brewery with a short position of Fiberhome Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tsingtao Brewery and Fiberhome Telecommunicatio.
Diversification Opportunities for Tsingtao Brewery and Fiberhome Telecommunicatio
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tsingtao and Fiberhome is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Tsingtao Brewery Co and Fiberhome Telecommunication Te in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiberhome Telecommunicatio and Tsingtao Brewery 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 Tsingtao Brewery Co are associated (or correlated) with Fiberhome Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiberhome Telecommunicatio has no effect on the direction of Tsingtao Brewery i.e., Tsingtao Brewery and Fiberhome Telecommunicatio go up and down completely randomly.
Pair Corralation between Tsingtao Brewery and Fiberhome Telecommunicatio
Assuming the 90 days trading horizon Tsingtao Brewery is expected to generate 3.22 times less return on investment than Fiberhome Telecommunicatio. But when comparing it to its historical volatility, Tsingtao Brewery Co is 1.27 times less risky than Fiberhome Telecommunicatio. It trades about 0.03 of its potential returns per unit of risk. Fiberhome Telecommunication Technologies is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,354 in Fiberhome Telecommunication Technologies on October 18, 2024 and sell it today you would earn a total of 553.00 from holding Fiberhome Telecommunication Technologies or generate 40.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tsingtao Brewery Co vs. Fiberhome Telecommunication Te
Performance |
| Timeline |
| Tsingtao Brewery |
| Fiberhome Telecommunicatio |
Tsingtao Brewery and Fiberhome Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tsingtao Brewery and Fiberhome Telecommunicatio
The main advantage of trading using opposite Tsingtao Brewery and Fiberhome Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tsingtao Brewery position performs unexpectedly, Fiberhome Telecommunicatio 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 Fiberhome Telecommunicatio will offset losses from the drop in Fiberhome Telecommunicatio's long position.| Tsingtao Brewery vs. Vohringer Home Technology | Tsingtao Brewery vs. China Eastern Airlines | Tsingtao Brewery vs. CSSC Offshore Marine | Tsingtao Brewery vs. Fiberhome Telecommunication Technologies |
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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