Correlation Between Talanx AG and China Datang
Can any of the company-specific risk be diversified away by investing in both Talanx AG and China Datang 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 Talanx AG and China Datang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Talanx AG and China Datang, you can compare the effects of market volatilities on Talanx AG and China Datang 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 Talanx AG with a short position of China Datang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Talanx AG and China Datang.
Diversification Opportunities for Talanx AG and China Datang
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Talanx and China is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Talanx AG and China Datang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Datang and Talanx AG 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 Talanx AG are associated (or correlated) with China Datang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Datang has no effect on the direction of Talanx AG i.e., Talanx AG and China Datang go up and down completely randomly.
Pair Corralation between Talanx AG and China Datang
Assuming the 90 days horizon Talanx AG is expected to generate 0.28 times more return on investment than China Datang. However, Talanx AG is 3.58 times less risky than China Datang. It trades about 0.16 of its potential returns per unit of risk. China Datang is currently generating about 0.02 per unit of risk. If you would invest 8,170 in Talanx AG on November 27, 2024 and sell it today you would earn a total of 305.00 from holding Talanx AG or generate 3.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Talanx AG vs. China Datang
Performance |
| Timeline |
| Talanx AG |
| China Datang |
Talanx AG and China Datang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Talanx AG and China Datang
The main advantage of trading using opposite Talanx AG and China Datang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Talanx AG position performs unexpectedly, China Datang 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 China Datang will offset losses from the drop in China Datang's long position.| Talanx AG vs. WESANA HEALTH HOLD | Talanx AG vs. US Foods Holding | Talanx AG vs. COMM HEALTH SYSTEMS | Talanx AG vs. Moneysupermarket Group PLC |
| China Datang vs. China Foods Limited | China Datang vs. CanSino Biologics | China Datang vs. SOUTHWEST AIRLINES | China Datang vs. United Natural Foods |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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