Correlation Between Crawford and Tian Ruixiang
Can any of the company-specific risk be diversified away by investing in both Crawford and Tian Ruixiang 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 Crawford and Tian Ruixiang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crawford Company and Tian Ruixiang Holdings, you can compare the effects of market volatilities on Crawford and Tian Ruixiang 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 Crawford with a short position of Tian Ruixiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford and Tian Ruixiang.
Diversification Opportunities for Crawford and Tian Ruixiang
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Crawford and Tian is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Company and Tian Ruixiang Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tian Ruixiang Holdings and Crawford 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 Crawford Company are associated (or correlated) with Tian Ruixiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tian Ruixiang Holdings has no effect on the direction of Crawford i.e., Crawford and Tian Ruixiang go up and down completely randomly.
Pair Corralation between Crawford and Tian Ruixiang
Assuming the 90 days horizon Crawford Company is expected to generate 0.44 times more return on investment than Tian Ruixiang. However, Crawford Company is 2.26 times less risky than Tian Ruixiang. It trades about 0.09 of its potential returns per unit of risk. Tian Ruixiang Holdings is currently generating about -0.05 per unit of risk. If you would invest 860.00 in Crawford Company on August 28, 2024 and sell it today you would earn a total of 220.00 from holding Crawford Company or generate 25.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crawford Company vs. Tian Ruixiang Holdings
Performance |
| Timeline |
| Crawford |
| Tian Ruixiang Holdings |
Crawford and Tian Ruixiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crawford and Tian Ruixiang
The main advantage of trading using opposite Crawford and Tian Ruixiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crawford position performs unexpectedly, Tian Ruixiang 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 Tian Ruixiang will offset losses from the drop in Tian Ruixiang's long position.| Crawford vs. CorVel Corp | Crawford vs. Erie Indemnity | Crawford vs. Willis Towers Watson | Crawford vs. Huize Holding |
| Tian Ruixiang vs. Reliance Global Group | Tian Ruixiang vs. Selectquote | Tian Ruixiang vs. GoHealth | Tian Ruixiang vs. Brown Brown |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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