Correlation Between Tianjin Capital and PULSION Medical
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and PULSION Medical 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 PULSION Medical 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 PULSION Medical Systems, you can compare the effects of market volatilities on Tianjin Capital and PULSION Medical 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 PULSION Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and PULSION Medical.
Diversification Opportunities for Tianjin Capital and PULSION Medical
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Tianjin and PULSION is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and PULSION Medical Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PULSION Medical Systems 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 PULSION Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PULSION Medical Systems has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and PULSION Medical go up and down completely randomly.
Pair Corralation between Tianjin Capital and PULSION Medical
Assuming the 90 days horizon Tianjin Capital Environmental is expected to under-perform the PULSION Medical. In addition to that, Tianjin Capital is 4.29 times more volatile than PULSION Medical Systems. It trades about -0.1 of its total potential returns per unit of risk. PULSION Medical Systems is currently generating about 0.32 per unit of volatility. If you would invest 1,590 in PULSION Medical Systems on October 27, 2024 and sell it today you would earn a total of 30.00 from holding PULSION Medical Systems or generate 1.89% 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. PULSION Medical Systems
Performance |
| Timeline |
| Tianjin Capital Envi |
| PULSION Medical Systems |
Tianjin Capital and PULSION Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and PULSION Medical
The main advantage of trading using opposite Tianjin Capital and PULSION Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, PULSION Medical 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 PULSION Medical will offset losses from the drop in PULSION Medical's long position.| Tianjin Capital vs. QBE Insurance Group | Tianjin Capital vs. Direct Line Insurance | Tianjin Capital vs. Reinsurance Group of | Tianjin Capital vs. LG Electronics |
| PULSION Medical vs. JLF INVESTMENT | PULSION Medical vs. REINET INVESTMENTS SCA | PULSION Medical vs. ASPEN TECHINC DL | PULSION Medical vs. HELIOS TECHS INC |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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