Correlation Between TianJin 712 and Guangdong Shenglu
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By analyzing existing cross correlation between TianJin 712 Communication and Guangdong Shenglu Telecommunication, you can compare the effects of market volatilities on TianJin 712 and Guangdong Shenglu 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 712 with a short position of Guangdong Shenglu. Check out your portfolio center. Please also check ongoing floating volatility patterns of TianJin 712 and Guangdong Shenglu.
Diversification Opportunities for TianJin 712 and Guangdong Shenglu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TianJin and Guangdong is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding TianJin 712 Communication and Guangdong Shenglu Telecommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Shenglu and TianJin 712 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 712 Communication are associated (or correlated) with Guangdong Shenglu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Shenglu has no effect on the direction of TianJin 712 i.e., TianJin 712 and Guangdong Shenglu go up and down completely randomly.
Pair Corralation between TianJin 712 and Guangdong Shenglu
Assuming the 90 days trading horizon TianJin 712 Communication is expected to under-perform the Guangdong Shenglu. But the stock apears to be less risky and, when comparing its historical volatility, TianJin 712 Communication is 1.12 times less risky than Guangdong Shenglu. The stock trades about -0.02 of its potential returns per unit of risk. The Guangdong Shenglu Telecommunication is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 968.00 in Guangdong Shenglu Telecommunication on September 14, 2024 and sell it today you would lose (198.00) from holding Guangdong Shenglu Telecommunication or give up 20.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TianJin 712 Communication vs. Guangdong Shenglu Telecommunic
Performance |
| Timeline |
| TianJin 712 Communication |
| Guangdong Shenglu |
TianJin 712 and Guangdong Shenglu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TianJin 712 and Guangdong Shenglu
The main advantage of trading using opposite TianJin 712 and Guangdong Shenglu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TianJin 712 position performs unexpectedly, Guangdong Shenglu 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 Guangdong Shenglu will offset losses from the drop in Guangdong Shenglu's long position.| TianJin 712 vs. Guangzhou Haige Communications | TianJin 712 vs. Zhongtong Guomai Communication | TianJin 712 vs. Zhengzhou Coal Mining | TianJin 712 vs. Changchun Faway Automobile |
| Guangdong Shenglu vs. China Railway Materials | Guangdong Shenglu vs. Xinke Material | Guangdong Shenglu vs. Orinko Advanced Plastics | Guangdong Shenglu vs. Chongqing Sulian Plastic |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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