Correlation Between Industrial Bank and Tjk Machinery
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By analyzing existing cross correlation between Industrial Bank Co and Tjk Machinery Tianjin, you can compare the effects of market volatilities on Industrial Bank and Tjk Machinery 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 Industrial Bank with a short position of Tjk Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and Tjk Machinery.
Diversification Opportunities for Industrial Bank and Tjk Machinery
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Tjk is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank Co and Tjk Machinery Tianjin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tjk Machinery Tianjin and Industrial Bank 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 Industrial Bank Co are associated (or correlated) with Tjk Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tjk Machinery Tianjin has no effect on the direction of Industrial Bank i.e., Industrial Bank and Tjk Machinery go up and down completely randomly.
Pair Corralation between Industrial Bank and Tjk Machinery
Assuming the 90 days trading horizon Industrial Bank Co is expected to under-perform the Tjk Machinery. But the stock apears to be less risky and, when comparing its historical volatility, Industrial Bank Co is 2.94 times less risky than Tjk Machinery. The stock trades about -0.17 of its potential returns per unit of risk. The Tjk Machinery Tianjin is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,343 in Tjk Machinery Tianjin on August 24, 2024 and sell it today you would earn a total of 135.00 from holding Tjk Machinery Tianjin or generate 10.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Bank Co vs. Tjk Machinery Tianjin
Performance |
| Timeline |
| Industrial Bank |
| Tjk Machinery Tianjin |
Industrial Bank and Tjk Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and Tjk Machinery
The main advantage of trading using opposite Industrial Bank and Tjk Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, Tjk Machinery 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 Tjk Machinery will offset losses from the drop in Tjk Machinery's long position.| Industrial Bank vs. New China Life | Industrial Bank vs. Ming Yang Smart | Industrial Bank vs. 159005 | Industrial Bank vs. Loctek Ergonomic Technology |
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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 Stocks Directory module to find actively traded stocks across global markets.
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