Correlation Between Tingyi Holding and Jia Jie
Can any of the company-specific risk be diversified away by investing in both Tingyi Holding and Jia Jie 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 Jia Jie 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 Jia Jie Biomedical, you can compare the effects of market volatilities on Tingyi Holding and Jia Jie 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 Jia Jie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tingyi Holding and Jia Jie.
Diversification Opportunities for Tingyi Holding and Jia Jie
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tingyi and Jia is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Tingyi Holding Corp and Jia Jie Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jia Jie Biomedical 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 Jia Jie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jia Jie Biomedical has no effect on the direction of Tingyi Holding i.e., Tingyi Holding and Jia Jie go up and down completely randomly.
Pair Corralation between Tingyi Holding and Jia Jie
Assuming the 90 days trading horizon Tingyi Holding Corp is expected to generate 0.66 times more return on investment than Jia Jie. However, Tingyi Holding Corp is 1.51 times less risky than Jia Jie. It trades about 0.26 of its potential returns per unit of risk. Jia Jie Biomedical is currently generating about -0.02 per unit of risk. If you would invest 2,110 in Tingyi Holding Corp on October 25, 2024 and sell it today you would earn a total of 300.00 from holding Tingyi Holding Corp or generate 14.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tingyi Holding Corp vs. Jia Jie Biomedical
Performance |
| Timeline |
| Tingyi Holding Corp |
| Jia Jie Biomedical |
Tingyi Holding and Jia Jie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tingyi Holding and Jia Jie
The main advantage of trading using opposite Tingyi Holding and Jia Jie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tingyi Holding position performs unexpectedly, Jia Jie 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 Jia Jie will offset losses from the drop in Jia Jie's long position.| Tingyi Holding vs. Uni President Enterprises Corp | Tingyi Holding vs. President Chain Store | Tingyi Holding vs. Formosa Chemicals Fibre | Tingyi Holding vs. Formosa Petrochemical Corp |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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