Correlation Between Keeson Technology and Tianjin Ruixin
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By analyzing existing cross correlation between Keeson Technology Corp and Tianjin Ruixin Technology, you can compare the effects of market volatilities on Keeson Technology and Tianjin Ruixin 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 Keeson Technology with a short position of Tianjin Ruixin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keeson Technology and Tianjin Ruixin.
Diversification Opportunities for Keeson Technology and Tianjin Ruixin
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Keeson and Tianjin is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Keeson Technology Corp and Tianjin Ruixin Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Ruixin Technology and Keeson Technology 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 Keeson Technology Corp are associated (or correlated) with Tianjin Ruixin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Ruixin Technology has no effect on the direction of Keeson Technology i.e., Keeson Technology and Tianjin Ruixin go up and down completely randomly.
Pair Corralation between Keeson Technology and Tianjin Ruixin
Assuming the 90 days trading horizon Keeson Technology Corp is expected to generate 1.22 times more return on investment than Tianjin Ruixin. However, Keeson Technology is 1.22 times more volatile than Tianjin Ruixin Technology. It trades about -0.1 of its potential returns per unit of risk. Tianjin Ruixin Technology is currently generating about -0.18 per unit of risk. If you would invest 1,208 in Keeson Technology Corp on October 21, 2024 and sell it today you would lose (139.00) from holding Keeson Technology Corp or give up 11.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keeson Technology Corp vs. Tianjin Ruixin Technology
Performance |
| Timeline |
| Keeson Technology Corp |
| Tianjin Ruixin Technology |
Keeson Technology and Tianjin Ruixin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keeson Technology and Tianjin Ruixin
The main advantage of trading using opposite Keeson Technology and Tianjin Ruixin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keeson Technology position performs unexpectedly, Tianjin Ruixin 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 Tianjin Ruixin will offset losses from the drop in Tianjin Ruixin's long position.The idea behind Keeson Technology Corp and Tianjin Ruixin Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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