Correlation Between Dawning Information and Sichuan Tianqi
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By analyzing existing cross correlation between Dawning Information Industry and Sichuan Tianqi Lithium, you can compare the effects of market volatilities on Dawning Information and Sichuan Tianqi 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 Dawning Information with a short position of Sichuan Tianqi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dawning Information and Sichuan Tianqi.
Diversification Opportunities for Dawning Information and Sichuan Tianqi
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dawning and Sichuan is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Dawning Information Industry and Sichuan Tianqi Lithium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Tianqi Lithium and Dawning Information 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 Dawning Information Industry are associated (or correlated) with Sichuan Tianqi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Tianqi Lithium has no effect on the direction of Dawning Information i.e., Dawning Information and Sichuan Tianqi go up and down completely randomly.
Pair Corralation between Dawning Information and Sichuan Tianqi
Assuming the 90 days trading horizon Dawning Information Industry is expected to generate 1.27 times more return on investment than Sichuan Tianqi. However, Dawning Information is 1.27 times more volatile than Sichuan Tianqi Lithium. It trades about 0.09 of its potential returns per unit of risk. Sichuan Tianqi Lithium is currently generating about -0.04 per unit of risk. If you would invest 2,299 in Dawning Information Industry on September 3, 2024 and sell it today you would earn a total of 6,181 from holding Dawning Information Industry or generate 268.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dawning Information Industry vs. Sichuan Tianqi Lithium
Performance |
| Timeline |
| Dawning Information |
| Sichuan Tianqi Lithium |
Dawning Information and Sichuan Tianqi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dawning Information and Sichuan Tianqi
The main advantage of trading using opposite Dawning Information and Sichuan Tianqi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dawning Information position performs unexpectedly, Sichuan Tianqi 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 Sichuan Tianqi will offset losses from the drop in Sichuan Tianqi's long position.| Dawning Information vs. Shanghai Xinhua Media | Dawning Information vs. Shanghai Metersbonwe FashionAccessories | Dawning Information vs. Guangdong Jingyi Metal | Dawning Information vs. Chengtun Mining Group |
| Sichuan Tianqi vs. Dareway Software Co | Sichuan Tianqi vs. Xinjiang Communications Construction | Sichuan Tianqi vs. Yindu Kitchen Equipment | Sichuan Tianqi vs. Anhui Deli Household |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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