Correlation Between Tianjin Capital and Gansu Jiu
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By analyzing existing cross correlation between Tianjin Capital Environmental and Gansu Jiu Steel, you can compare the effects of market volatilities on Tianjin Capital and Gansu Jiu 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 Capital with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and Gansu Jiu.
Diversification Opportunities for Tianjin Capital and Gansu Jiu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tianjin and Gansu is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Tianjin Capital 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 Capital Environmental are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and Gansu Jiu go up and down completely randomly.
Pair Corralation between Tianjin Capital and Gansu Jiu
Assuming the 90 days trading horizon Tianjin Capital Environmental is expected to generate 0.44 times more return on investment than Gansu Jiu. However, Tianjin Capital Environmental is 2.26 times less risky than Gansu Jiu. It trades about 0.03 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about -0.24 per unit of risk. If you would invest 606.00 in Tianjin Capital Environmental on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Tianjin Capital Environmental or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. Gansu Jiu Steel
Performance |
| Timeline |
| Tianjin Capital Envi |
| Gansu Jiu Steel |
Tianjin Capital and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and Gansu Jiu
The main advantage of trading using opposite Tianjin Capital and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Tianjin Capital vs. Bank of China | Tianjin Capital vs. Kweichow Moutai Co | Tianjin Capital vs. PetroChina Co Ltd | Tianjin Capital vs. Bank of Communications |
| Gansu Jiu vs. Jinhe Biotechnology Co | Gansu Jiu vs. Southern PublishingMedia Co | Gansu Jiu vs. Guangdong Marubi Biotechnology | Gansu Jiu vs. Time Publishing and |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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