Correlation Between TIANDE CHEMICAL and China Resources
Can any of the company-specific risk be diversified away by investing in both TIANDE CHEMICAL and China Resources 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 China Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TIANDE CHEMICAL and China Resources Land, you can compare the effects of market volatilities on TIANDE CHEMICAL and China Resources 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 China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of TIANDE CHEMICAL and China Resources.
Diversification Opportunities for TIANDE CHEMICAL and China Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between TIANDE and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TIANDE CHEMICAL and China Resources Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Land 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 China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Land has no effect on the direction of TIANDE CHEMICAL i.e., TIANDE CHEMICAL and China Resources go up and down completely randomly.
Pair Corralation between TIANDE CHEMICAL and China Resources
Assuming the 90 days trading horizon TIANDE CHEMICAL is expected to generate 0.94 times more return on investment than China Resources. However, TIANDE CHEMICAL is 1.07 times less risky than China Resources. It trades about 0.07 of its potential returns per unit of risk. China Resources Land is currently generating about 0.04 per unit of risk. If you would invest 3.08 in TIANDE CHEMICAL on November 6, 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 | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TIANDE CHEMICAL vs. China Resources Land
Performance |
| Timeline |
| TIANDE CHEMICAL |
| China Resources Land |
TIANDE CHEMICAL and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TIANDE CHEMICAL and China Resources
The main advantage of trading using opposite TIANDE CHEMICAL and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TIANDE CHEMICAL position performs unexpectedly, China Resources 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 Resources will offset losses from the drop in China Resources' long position.| TIANDE CHEMICAL vs. COSMOSTEEL HLDGS | TIANDE CHEMICAL vs. DENTSPLY SIRONA | TIANDE CHEMICAL vs. GRENKELEASING Dusseldorf | TIANDE CHEMICAL vs. Lendlease Group |
| China Resources vs. SEAZEN GROUP LTD | China Resources vs. Atrium Ljungberg AB | China Resources vs. GANGLONG CHINA PRGRLTD |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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