Correlation Between Tianjin Capital and Gemfields Group
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and Gemfields Group 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 Tianjin Capital and Gemfields Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tianjin Capital Environmental and Gemfields Group Limited, you can compare the effects of market volatilities on Tianjin Capital and Gemfields Group 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 Tianjin Capital with a short position of Gemfields Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and Gemfields Group.
Diversification Opportunities for Tianjin Capital and Gemfields Group
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tianjin and Gemfields is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and Gemfields Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gemfields Group and Tianjin Capital 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 Tianjin Capital Environmental are associated (or correlated) with Gemfields Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gemfields Group has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and Gemfields Group go up and down completely randomly.
Pair Corralation between Tianjin Capital and Gemfields Group
Assuming the 90 days horizon Tianjin Capital Environmental is expected to generate 0.18 times more return on investment than Gemfields Group. However, Tianjin Capital Environmental is 5.56 times less risky than Gemfields Group. It trades about 0.01 of its potential returns per unit of risk. Gemfields Group Limited is currently generating about 0.0 per unit of risk. If you would invest 39.00 in Tianjin Capital Environmental on November 7, 2024 and sell it today you would earn a total of 0.00 from holding Tianjin Capital Environmental or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. Gemfields Group Limited
Performance |
| Timeline |
| Tianjin Capital Envi |
| Gemfields Group |
Tianjin Capital and Gemfields Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and Gemfields Group
The main advantage of trading using opposite Tianjin Capital and Gemfields Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, Gemfields Group 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 Gemfields Group will offset losses from the drop in Gemfields Group's long position.| Tianjin Capital vs. Waste Management | Tianjin Capital vs. Republic Services | Tianjin Capital vs. Waste Connections | Tianjin Capital vs. Veolia Environnement SA |
| Gemfields Group vs. Tower Semiconductor | Gemfields Group vs. BE Semiconductor Industries | Gemfields Group vs. RETAIL FOOD GROUP | Gemfields Group vs. TOREX SEMICONDUCTOR LTD |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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