Correlation Between Epoxy Base and TongFu Microelectronics
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By analyzing existing cross correlation between Epoxy Base Electronic and TongFu Microelectronics Co, you can compare the effects of market volatilities on Epoxy Base and TongFu Microelectronics 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 Epoxy Base with a short position of TongFu Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Epoxy Base and TongFu Microelectronics.
Diversification Opportunities for Epoxy Base and TongFu Microelectronics
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Epoxy and TongFu is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Epoxy Base Electronic and TongFu Microelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TongFu Microelectronics and Epoxy Base 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 Epoxy Base Electronic are associated (or correlated) with TongFu Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TongFu Microelectronics has no effect on the direction of Epoxy Base i.e., Epoxy Base and TongFu Microelectronics go up and down completely randomly.
Pair Corralation between Epoxy Base and TongFu Microelectronics
Assuming the 90 days trading horizon Epoxy Base Electronic is expected to under-perform the TongFu Microelectronics. In addition to that, Epoxy Base is 1.08 times more volatile than TongFu Microelectronics Co. It trades about -0.01 of its total potential returns per unit of risk. TongFu Microelectronics Co is currently generating about 0.04 per unit of volatility. If you would invest 2,312 in TongFu Microelectronics Co on August 29, 2024 and sell it today you would earn a total of 587.00 from holding TongFu Microelectronics Co or generate 25.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Epoxy Base Electronic vs. TongFu Microelectronics Co
Performance |
| Timeline |
| Epoxy Base Electronic |
| TongFu Microelectronics |
Epoxy Base and TongFu Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Epoxy Base and TongFu Microelectronics
The main advantage of trading using opposite Epoxy Base and TongFu Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Epoxy Base position performs unexpectedly, TongFu Microelectronics 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 TongFu Microelectronics will offset losses from the drop in TongFu Microelectronics' long position.| Epoxy Base vs. Tieling Newcity Investment | Epoxy Base vs. Zhongrun Resources Investment | Epoxy Base vs. Tibet Huayu Mining | Epoxy Base vs. Zoje Resources Investment |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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