Correlation Between Tianjin Capital and Figs
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and Figs 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 Figs 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 Figs Inc, you can compare the effects of market volatilities on Tianjin Capital and Figs 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 Figs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and Figs.
Diversification Opportunities for Tianjin Capital and Figs
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tianjin and Figs is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and Figs Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Figs Inc 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 Figs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Figs Inc has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and Figs go up and down completely randomly.
Pair Corralation between Tianjin Capital and Figs
Assuming the 90 days horizon Tianjin Capital Environmental is expected to generate 2.23 times more return on investment than Figs. However, Tianjin Capital is 2.23 times more volatile than Figs Inc. It trades about 0.1 of its potential returns per unit of risk. Figs Inc is currently generating about 0.02 per unit of risk. If you would invest 15.00 in Tianjin Capital Environmental on August 30, 2024 and sell it today you would earn a total of 23.00 from holding Tianjin Capital Environmental or generate 153.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. Figs Inc
Performance |
| Timeline |
| Tianjin Capital Envi |
| Figs Inc |
Tianjin Capital and Figs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and Figs
The main advantage of trading using opposite Tianjin Capital and Figs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, Figs 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 Figs will offset losses from the drop in Figs' long position.| Tianjin Capital vs. Bright Scholar Education | Tianjin Capital vs. Universal Technical Institute | Tianjin Capital vs. Toro Co | Tianjin Capital vs. Ihuman 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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