Correlation Between Tianjin Capital and Ameriprise Financial
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and Ameriprise Financial 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 Ameriprise Financial 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 Ameriprise Financial, you can compare the effects of market volatilities on Tianjin Capital and Ameriprise Financial 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 Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and Ameriprise Financial.
Diversification Opportunities for Tianjin Capital and Ameriprise Financial
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tianjin and Ameriprise is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial 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 Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and Ameriprise Financial go up and down completely randomly.
Pair Corralation between Tianjin Capital and Ameriprise Financial
Assuming the 90 days horizon Tianjin Capital Environmental is expected to generate 3.38 times more return on investment than Ameriprise Financial. However, Tianjin Capital is 3.38 times more volatile than Ameriprise Financial. It trades about 0.06 of its potential returns per unit of risk. Ameriprise Financial is currently generating about 0.12 per unit of risk. If you would invest 18.00 in Tianjin Capital Environmental on October 16, 2024 and sell it today you would earn a total of 20.00 from holding Tianjin Capital Environmental or generate 111.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. Ameriprise Financial
Performance |
| Timeline |
| Tianjin Capital Envi |
| Ameriprise Financial |
Tianjin Capital and Ameriprise Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and Ameriprise Financial
The main advantage of trading using opposite Tianjin Capital and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.| Tianjin Capital vs. Zoom Video Communications | Tianjin Capital vs. Entravision Communications | Tianjin Capital vs. Singapore Telecommunications Limited | Tianjin Capital vs. Iridium Communications |
| Ameriprise Financial vs. KINGBOARD CHEMICAL | Ameriprise Financial vs. Tianjin Capital Environmental | Ameriprise Financial vs. COSMOSTEEL HLDGS | Ameriprise Financial vs. KOBE STEEL 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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