Correlation Between Dairy Farm and CHINA TONTINE
Can any of the company-specific risk be diversified away by investing in both Dairy Farm and CHINA TONTINE 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 Dairy Farm and CHINA TONTINE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dairy Farm International and CHINA TONTINE WINES, you can compare the effects of market volatilities on Dairy Farm and CHINA TONTINE 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 Dairy Farm with a short position of CHINA TONTINE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dairy Farm and CHINA TONTINE.
Diversification Opportunities for Dairy Farm and CHINA TONTINE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dairy and CHINA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dairy Farm International and CHINA TONTINE WINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA TONTINE WINES and Dairy Farm 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 Dairy Farm International are associated (or correlated) with CHINA TONTINE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA TONTINE WINES has no effect on the direction of Dairy Farm i.e., Dairy Farm and CHINA TONTINE go up and down completely randomly.
Pair Corralation between Dairy Farm and CHINA TONTINE
If you would invest 162.00 in Dairy Farm International on August 28, 2024 and sell it today you would earn a total of 72.00 from holding Dairy Farm International or generate 44.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dairy Farm International vs. CHINA TONTINE WINES
Performance |
| Timeline |
| Dairy Farm International |
| CHINA TONTINE WINES |
Dairy Farm and CHINA TONTINE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dairy Farm and CHINA TONTINE
The main advantage of trading using opposite Dairy Farm and CHINA TONTINE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dairy Farm position performs unexpectedly, CHINA TONTINE 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 CHINA TONTINE will offset losses from the drop in CHINA TONTINE's long position.| Dairy Farm vs. Superior Plus Corp | Dairy Farm vs. NMI Holdings | Dairy Farm vs. Origin Agritech | Dairy Farm vs. SIVERS SEMICONDUCTORS AB |
| CHINA TONTINE vs. Superior Plus Corp | CHINA TONTINE vs. NMI Holdings | CHINA TONTINE vs. Origin Agritech | CHINA TONTINE vs. SIVERS SEMICONDUCTORS AB |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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