Correlation Between TianJin 712 and Ningbo David
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By analyzing existing cross correlation between TianJin 712 Communication and Ningbo David Medical, you can compare the effects of market volatilities on TianJin 712 and Ningbo David 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 Ningbo David. Check out your portfolio center. Please also check ongoing floating volatility patterns of TianJin 712 and Ningbo David.
Diversification Opportunities for TianJin 712 and Ningbo David
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TianJin and Ningbo is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding TianJin 712 Communication and Ningbo David Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo David Medical 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 Ningbo David. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo David Medical has no effect on the direction of TianJin 712 i.e., TianJin 712 and Ningbo David go up and down completely randomly.
Pair Corralation between TianJin 712 and Ningbo David
Assuming the 90 days trading horizon TianJin 712 Communication is expected to generate 1.4 times more return on investment than Ningbo David. However, TianJin 712 is 1.4 times more volatile than Ningbo David Medical. It trades about 0.13 of its potential returns per unit of risk. Ningbo David Medical is currently generating about 0.05 per unit of risk. If you would invest 1,778 in TianJin 712 Communication on September 13, 2024 and sell it today you would earn a total of 361.00 from holding TianJin 712 Communication or generate 20.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
TianJin 712 Communication vs. Ningbo David Medical
Performance |
| Timeline |
| TianJin 712 Communication |
| Ningbo David Medical |
TianJin 712 and Ningbo David Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TianJin 712 and Ningbo David
The main advantage of trading using opposite TianJin 712 and Ningbo David positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TianJin 712 position performs unexpectedly, Ningbo David 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 Ningbo David will offset losses from the drop in Ningbo David's long position.| TianJin 712 vs. Industrial and Commercial | TianJin 712 vs. China Construction Bank | TianJin 712 vs. Bank of China | TianJin 712 vs. Agricultural Bank of |
| Ningbo David vs. Guangdong Brandmax Marketing | Ningbo David vs. Jiangxi Naipu Mining | Ningbo David vs. Hainan Mining Co | Ningbo David vs. Huaibei Mining Holdings |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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