Correlation Between TIANDE CHEMICAL and Bollor SE
Can any of the company-specific risk be diversified away by investing in both TIANDE CHEMICAL and Bollor SE 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 TIANDE CHEMICAL and Bollor SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TIANDE CHEMICAL and Bollor SE, you can compare the effects of market volatilities on TIANDE CHEMICAL and Bollor SE 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 TIANDE CHEMICAL with a short position of Bollor SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of TIANDE CHEMICAL and Bollor SE.
Diversification Opportunities for TIANDE CHEMICAL and Bollor SE
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TIANDE and Bollor is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding TIANDE CHEMICAL and Bollor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bollor SE and TIANDE CHEMICAL 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 TIANDE CHEMICAL are associated (or correlated) with Bollor SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bollor SE has no effect on the direction of TIANDE CHEMICAL i.e., TIANDE CHEMICAL and Bollor SE go up and down completely randomly.
Pair Corralation between TIANDE CHEMICAL and Bollor SE
Assuming the 90 days trading horizon TIANDE CHEMICAL is expected to generate 2.79 times more return on investment than Bollor SE. However, TIANDE CHEMICAL is 2.79 times more volatile than Bollor SE. It trades about 0.06 of its potential returns per unit of risk. Bollor SE is currently generating about 0.03 per unit of risk. If you would invest 3.08 in TIANDE CHEMICAL on September 14, 2024 and sell it today you would earn a total of 4.17 from holding TIANDE CHEMICAL or generate 135.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TIANDE CHEMICAL vs. Bollor SE
Performance |
| Timeline |
| TIANDE CHEMICAL |
| Bollor SE |
TIANDE CHEMICAL and Bollor SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TIANDE CHEMICAL and Bollor SE
The main advantage of trading using opposite TIANDE CHEMICAL and Bollor SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TIANDE CHEMICAL position performs unexpectedly, Bollor SE 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 Bollor SE will offset losses from the drop in Bollor SE's long position.| TIANDE CHEMICAL vs. BURLINGTON STORES | TIANDE CHEMICAL vs. Coor Service Management | TIANDE CHEMICAL vs. Waste Management | TIANDE CHEMICAL vs. CEOTRONICS |
| Bollor SE vs. GAMESTOP | Bollor SE vs. Games Workshop Group | Bollor SE vs. NISSAN CHEMICAL IND | Bollor SE vs. TIANDE CHEMICAL |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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