Correlation Between TianJin 712 and Shanghai Yanpu
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By analyzing existing cross correlation between TianJin 712 Communication and Shanghai Yanpu Metal, you can compare the effects of market volatilities on TianJin 712 and Shanghai Yanpu 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 Shanghai Yanpu. Check out your portfolio center. Please also check ongoing floating volatility patterns of TianJin 712 and Shanghai Yanpu.
Diversification Opportunities for TianJin 712 and Shanghai Yanpu
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between TianJin and Shanghai is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding TianJin 712 Communication and Shanghai Yanpu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Yanpu Metal 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 Shanghai Yanpu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Yanpu Metal has no effect on the direction of TianJin 712 i.e., TianJin 712 and Shanghai Yanpu go up and down completely randomly.
Pair Corralation between TianJin 712 and Shanghai Yanpu
Assuming the 90 days trading horizon TianJin 712 Communication is expected to generate 1.42 times more return on investment than Shanghai Yanpu. However, TianJin 712 is 1.42 times more volatile than Shanghai Yanpu Metal. It trades about 0.25 of its potential returns per unit of risk. Shanghai Yanpu Metal is currently generating about 0.27 per unit of risk. If you would invest 1,735 in TianJin 712 Communication on September 18, 2024 and sell it today you would earn a total of 386.00 from holding TianJin 712 Communication or generate 22.25% 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. Shanghai Yanpu Metal
Performance |
| Timeline |
| TianJin 712 Communication |
| Shanghai Yanpu Metal |
TianJin 712 and Shanghai Yanpu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TianJin 712 and Shanghai Yanpu
The main advantage of trading using opposite TianJin 712 and Shanghai Yanpu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TianJin 712 position performs unexpectedly, Shanghai Yanpu 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 Shanghai Yanpu will offset losses from the drop in Shanghai Yanpu'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 |
| Shanghai Yanpu vs. BeiGene | Shanghai Yanpu vs. Kweichow Moutai Co | Shanghai Yanpu vs. Beijing Roborock Technology | Shanghai Yanpu vs. G bits Network Technology |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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