Correlation Between Tianjin Capital and First Republic
Can any of the company-specific risk be diversified away by investing in both Tianjin Capital and First Republic 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 First Republic 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 First Republic Bank, you can compare the effects of market volatilities on Tianjin Capital and First Republic 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 First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and First Republic.
Diversification Opportunities for Tianjin Capital and First Republic
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tianjin and First is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank 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 First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and First Republic go up and down completely randomly.
Pair Corralation between Tianjin Capital and First Republic
If you would invest 0.01 in First Republic Bank on September 3, 2024 and sell it today you would earn a total of 0.00 from holding First Republic Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. First Republic Bank
Performance |
| Timeline |
| Tianjin Capital Envi |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tianjin Capital and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and First Republic
The main advantage of trading using opposite Tianjin Capital and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Tianjin Capital vs. Weibo Corp | Tianjin Capital vs. Dave Busters Entertainment | Tianjin Capital vs. Hafnia Limited | Tianjin Capital vs. National CineMedia |
| First Republic vs. Omni Health | First Republic vs. Vodka Brands Corp | First Republic vs. BioNTech SE | First Republic vs. RadNet 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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