Correlation Between TuanChe ADR and Asset Entities
Can any of the company-specific risk be diversified away by investing in both TuanChe ADR and Asset Entities 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 TuanChe ADR and Asset Entities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TuanChe ADR and Asset Entities Class, you can compare the effects of market volatilities on TuanChe ADR and Asset Entities 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 TuanChe ADR with a short position of Asset Entities. Check out your portfolio center. Please also check ongoing floating volatility patterns of TuanChe ADR and Asset Entities.
Diversification Opportunities for TuanChe ADR and Asset Entities
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TuanChe and Asset is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding TuanChe ADR and Asset Entities Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asset Entities Class and TuanChe ADR 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 TuanChe ADR are associated (or correlated) with Asset Entities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asset Entities Class has no effect on the direction of TuanChe ADR i.e., TuanChe ADR and Asset Entities go up and down completely randomly.
Pair Corralation between TuanChe ADR and Asset Entities
Allowing for the 90-day total investment horizon TuanChe ADR is expected to generate 1.43 times more return on investment than Asset Entities. However, TuanChe ADR is 1.43 times more volatile than Asset Entities Class. It trades about -0.15 of its potential returns per unit of risk. Asset Entities Class is currently generating about -0.37 per unit of risk. If you would invest 172.00 in TuanChe ADR on August 27, 2024 and sell it today you would lose (76.00) from holding TuanChe ADR or give up 44.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TuanChe ADR vs. Asset Entities Class
Performance |
| Timeline |
| TuanChe ADR |
| Asset Entities Class |
TuanChe ADR and Asset Entities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TuanChe ADR and Asset Entities
The main advantage of trading using opposite TuanChe ADR and Asset Entities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TuanChe ADR position performs unexpectedly, Asset Entities 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 Asset Entities will offset losses from the drop in Asset Entities' long position.| TuanChe ADR vs. Onfolio Holdings | TuanChe ADR vs. Starbox Group Holdings | TuanChe ADR vs. MediaAlpha | TuanChe ADR vs. Metalpha Technology Holding |
| Asset Entities vs. Trivago NV | Asset Entities vs. Cheetah Mobile | Asset Entities vs. Comscore | Asset Entities vs. Arena Group Holdings |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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