Correlation Between Tianjin Capital and CRYOLIFE
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and CRYOLIFE 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 CRYOLIFE 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 CRYOLIFE, you can compare the effects of market volatilities on Tianjin Capital and CRYOLIFE 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 CRYOLIFE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and CRYOLIFE.
Diversification Opportunities for Tianjin Capital and CRYOLIFE
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tianjin and CRYOLIFE is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and CRYOLIFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CRYOLIFE 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 CRYOLIFE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CRYOLIFE has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and CRYOLIFE go up and down completely randomly.
Pair Corralation between Tianjin Capital and CRYOLIFE
Assuming the 90 days horizon Tianjin Capital Environmental is expected to generate 2.13 times more return on investment than CRYOLIFE. However, Tianjin Capital is 2.13 times more volatile than CRYOLIFE. It trades about 0.06 of its potential returns per unit of risk. CRYOLIFE is currently generating about 0.08 per unit of risk. If you would invest 12.00 in Tianjin Capital Environmental on September 12, 2024 and sell it today you would earn a total of 27.00 from holding Tianjin Capital Environmental or generate 225.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. CRYOLIFE
Performance |
| Timeline |
| Tianjin Capital Envi |
| CRYOLIFE |
Tianjin Capital and CRYOLIFE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and CRYOLIFE
The main advantage of trading using opposite Tianjin Capital and CRYOLIFE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, CRYOLIFE 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 CRYOLIFE will offset losses from the drop in CRYOLIFE's long position.| Tianjin Capital vs. Datadog | Tianjin Capital vs. ALIOR BANK | Tianjin Capital vs. REVO INSURANCE SPA | Tianjin Capital vs. Datang International Power |
| CRYOLIFE vs. MITSUBISHI STEEL MFG | CRYOLIFE vs. Entravision Communications | CRYOLIFE vs. Ribbon Communications | CRYOLIFE vs. Tianjin Capital Environmental |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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