Correlation Between Tian Ruixiang and Huize Holding
Can any of the company-specific risk be diversified away by investing in both Tian Ruixiang and Huize Holding 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 Tian Ruixiang and Huize Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tian Ruixiang Holdings and Huize Holding, you can compare the effects of market volatilities on Tian Ruixiang and Huize Holding 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 Tian Ruixiang with a short position of Huize Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tian Ruixiang and Huize Holding.
Diversification Opportunities for Tian Ruixiang and Huize Holding
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tian and Huize is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Tian Ruixiang Holdings and Huize Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huize Holding and Tian Ruixiang 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 Tian Ruixiang Holdings are associated (or correlated) with Huize Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huize Holding has no effect on the direction of Tian Ruixiang i.e., Tian Ruixiang and Huize Holding go up and down completely randomly.
Pair Corralation between Tian Ruixiang and Huize Holding
Given the investment horizon of 90 days Tian Ruixiang Holdings is expected to generate 0.82 times more return on investment than Huize Holding. However, Tian Ruixiang Holdings is 1.22 times less risky than Huize Holding. It trades about 0.01 of its potential returns per unit of risk. Huize Holding is currently generating about -0.05 per unit of risk. If you would invest 175.00 in Tian Ruixiang Holdings on August 29, 2024 and sell it today you would lose (6.00) from holding Tian Ruixiang Holdings or give up 3.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tian Ruixiang Holdings vs. Huize Holding
Performance |
| Timeline |
| Tian Ruixiang Holdings |
| Huize Holding |
Tian Ruixiang and Huize Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tian Ruixiang and Huize Holding
The main advantage of trading using opposite Tian Ruixiang and Huize Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tian Ruixiang position performs unexpectedly, Huize Holding 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 Huize Holding will offset losses from the drop in Huize Holding's long position.| Tian Ruixiang vs. Arthur J Gallagher | Tian Ruixiang vs. Willis Towers Watson | Tian Ruixiang vs. Erie Indemnity | Tian Ruixiang vs. Marsh McLennan Companies |
| Huize Holding vs. Arthur J Gallagher | Huize Holding vs. Willis Towers Watson | Huize Holding vs. Erie Indemnity | Huize Holding vs. Marsh McLennan Companies |
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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