Correlation Between Tuniu Corp and Transat AT
Can any of the company-specific risk be diversified away by investing in both Tuniu Corp and Transat AT 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 Tuniu Corp and Transat AT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tuniu Corp and Transat AT, you can compare the effects of market volatilities on Tuniu Corp and Transat AT 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 Tuniu Corp with a short position of Transat AT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tuniu Corp and Transat AT.
Diversification Opportunities for Tuniu Corp and Transat AT
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tuniu and Transat is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Tuniu Corp and Transat AT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transat AT and Tuniu Corp 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 Tuniu Corp are associated (or correlated) with Transat AT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transat AT has no effect on the direction of Tuniu Corp i.e., Tuniu Corp and Transat AT go up and down completely randomly.
Pair Corralation between Tuniu Corp and Transat AT
Given the investment horizon of 90 days Tuniu Corp is expected to under-perform the Transat AT. In addition to that, Tuniu Corp is 1.41 times more volatile than Transat AT. It trades about -0.14 of its total potential returns per unit of risk. Transat AT is currently generating about 0.01 per unit of volatility. If you would invest 135.00 in Transat AT on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Transat AT or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tuniu Corp vs. Transat AT
Performance |
| Timeline |
| Tuniu Corp |
| Transat AT |
Tuniu Corp and Transat AT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tuniu Corp and Transat AT
The main advantage of trading using opposite Tuniu Corp and Transat AT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tuniu Corp position performs unexpectedly, Transat AT 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 Transat AT will offset losses from the drop in Transat AT's long position.| Tuniu Corp vs. TripAdvisor | Tuniu Corp vs. MakeMyTrip Limited | Tuniu Corp vs. Booking Holdings | Tuniu Corp vs. Despegar Corp |
| Transat AT vs. Porsche Automobile Holding | Transat AT vs. Ferrari NV | Transat AT vs. Toyota Motor | Transat AT vs. General Motors |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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