Correlation Between Eastroc Beverage and Tengda Construction
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By analyzing existing cross correlation between Eastroc Beverage Group and Tengda Construction Group, you can compare the effects of market volatilities on Eastroc Beverage and Tengda Construction 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 Eastroc Beverage with a short position of Tengda Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastroc Beverage and Tengda Construction.
Diversification Opportunities for Eastroc Beverage and Tengda Construction
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Eastroc and Tengda is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Eastroc Beverage Group and Tengda Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tengda Construction and Eastroc Beverage 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 Eastroc Beverage Group are associated (or correlated) with Tengda Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tengda Construction has no effect on the direction of Eastroc Beverage i.e., Eastroc Beverage and Tengda Construction go up and down completely randomly.
Pair Corralation between Eastroc Beverage and Tengda Construction
Assuming the 90 days trading horizon Eastroc Beverage is expected to generate 6.08 times less return on investment than Tengda Construction. But when comparing it to its historical volatility, Eastroc Beverage Group is 1.21 times less risky than Tengda Construction. It trades about 0.01 of its potential returns per unit of risk. Tengda Construction Group is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 240.00 in Tengda Construction Group on September 4, 2024 and sell it today you would earn a total of 14.00 from holding Tengda Construction Group or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastroc Beverage Group vs. Tengda Construction Group
Performance |
| Timeline |
| Eastroc Beverage |
| Tengda Construction |
Eastroc Beverage and Tengda Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastroc Beverage and Tengda Construction
The main advantage of trading using opposite Eastroc Beverage and Tengda Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastroc Beverage position performs unexpectedly, Tengda Construction 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 Tengda Construction will offset losses from the drop in Tengda Construction's long position.| Eastroc Beverage vs. Shaanxi Energy Investment | Eastroc Beverage vs. China Express Airlines | Eastroc Beverage vs. Wuhan Hvsen Biotechnology | Eastroc Beverage vs. Ningbo MedicalSystem Biotechnology |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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