Correlation Between Tianjin Capital and CECO ENVIRONMENTAL
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and CECO ENVIRONMENTAL 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 CECO ENVIRONMENTAL 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 CECO ENVIRONMENTAL, you can compare the effects of market volatilities on Tianjin Capital and CECO ENVIRONMENTAL 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 CECO ENVIRONMENTAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and CECO ENVIRONMENTAL.
Diversification Opportunities for Tianjin Capital and CECO ENVIRONMENTAL
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tianjin and CECO is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and CECO ENVIRONMENTAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CECO ENVIRONMENTAL 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 CECO ENVIRONMENTAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CECO ENVIRONMENTAL has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and CECO ENVIRONMENTAL go up and down completely randomly.
Pair Corralation between Tianjin Capital and CECO ENVIRONMENTAL
Assuming the 90 days horizon Tianjin Capital is expected to generate 5.79 times less return on investment than CECO ENVIRONMENTAL. But when comparing it to its historical volatility, Tianjin Capital Environmental is 2.75 times less risky than CECO ENVIRONMENTAL. It trades about 0.07 of its potential returns per unit of risk. CECO ENVIRONMENTAL is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,450 in CECO ENVIRONMENTAL on August 24, 2024 and sell it today you would earn a total of 398.00 from holding CECO ENVIRONMENTAL or generate 16.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. CECO ENVIRONMENTAL
Performance |
| Timeline |
| Tianjin Capital Envi |
| CECO ENVIRONMENTAL |
Tianjin Capital and CECO ENVIRONMENTAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and CECO ENVIRONMENTAL
The main advantage of trading using opposite Tianjin Capital and CECO ENVIRONMENTAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, CECO ENVIRONMENTAL 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 CECO ENVIRONMENTAL will offset losses from the drop in CECO ENVIRONMENTAL's long position.| Tianjin Capital vs. GFL ENVIRONM | Tianjin Capital vs. Superior Plus Corp | Tianjin Capital vs. NMI Holdings | Tianjin Capital vs. Origin Agritech |
| CECO ENVIRONMENTAL vs. SIDETRADE EO 1 | CECO ENVIRONMENTAL vs. Auto Trader Group | CECO ENVIRONMENTAL vs. AUTO TRADER ADR | CECO ENVIRONMENTAL vs. MEDICAL FACILITIES NEW |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |