Correlation Between Tingyi Holding and TTET Union
Can any of the company-specific risk be diversified away by investing in both Tingyi Holding and TTET Union at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Tingyi Holding and TTET Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tingyi Holding Corp and TTET Union Corp, you can compare the effects of market volatilities on Tingyi Holding and TTET Union 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 Tingyi Holding with a short position of TTET Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tingyi Holding and TTET Union.
Diversification Opportunities for Tingyi Holding and TTET Union
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tingyi and TTET is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Tingyi Holding Corp and TTET Union Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TTET Union Corp and Tingyi Holding 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 Tingyi Holding Corp are associated (or correlated) with TTET Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TTET Union Corp has no effect on the direction of Tingyi Holding i.e., Tingyi Holding and TTET Union go up and down completely randomly.
Pair Corralation between Tingyi Holding and TTET Union
Assuming the 90 days trading horizon Tingyi Holding Corp is expected to under-perform the TTET Union. In addition to that, Tingyi Holding is 1.81 times more volatile than TTET Union Corp. It trades about -0.34 of its total potential returns per unit of risk. TTET Union Corp is currently generating about -0.29 per unit of volatility. If you would invest 15,400 in TTET Union Corp on August 28, 2024 and sell it today you would lose (700.00) from holding TTET Union Corp or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tingyi Holding Corp vs. TTET Union Corp
Performance |
| Timeline |
| Tingyi Holding Corp |
| TTET Union Corp |
Tingyi Holding and TTET Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tingyi Holding and TTET Union
The main advantage of trading using opposite Tingyi Holding and TTET Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tingyi Holding position performs unexpectedly, TTET Union 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 TTET Union will offset losses from the drop in TTET Union's long position.| Tingyi Holding vs. Uni President Enterprises Corp | Tingyi Holding vs. Lien Hwa Industrial | Tingyi Holding vs. Great Wall Enterprise | Tingyi Holding vs. Standard Foods Corp |
| TTET Union vs. Charoen Pokphand Enterprise | TTET Union vs. Standard Foods Corp | TTET Union vs. Uni President Enterprises Corp | TTET Union vs. Great Wall Enterprise |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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