Correlation Between Tsingtao Brewery and CREO MEDICAL
Can any of the company-specific risk be diversified away by investing in both Tsingtao Brewery and CREO MEDICAL 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 Tsingtao Brewery and CREO MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tsingtao Brewery and CREO MEDICAL GRP, you can compare the effects of market volatilities on Tsingtao Brewery and CREO MEDICAL 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 Tsingtao Brewery with a short position of CREO MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tsingtao Brewery and CREO MEDICAL.
Diversification Opportunities for Tsingtao Brewery and CREO MEDICAL
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tsingtao and CREO is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Tsingtao Brewery and CREO MEDICAL GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CREO MEDICAL GRP and Tsingtao Brewery 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 Tsingtao Brewery are associated (or correlated) with CREO MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CREO MEDICAL GRP has no effect on the direction of Tsingtao Brewery i.e., Tsingtao Brewery and CREO MEDICAL go up and down completely randomly.
Pair Corralation between Tsingtao Brewery and CREO MEDICAL
Assuming the 90 days trading horizon Tsingtao Brewery is expected to generate 1.27 times more return on investment than CREO MEDICAL. However, Tsingtao Brewery is 1.27 times more volatile than CREO MEDICAL GRP. It trades about 0.07 of its potential returns per unit of risk. CREO MEDICAL GRP is currently generating about -0.05 per unit of risk. If you would invest 372.00 in Tsingtao Brewery on October 17, 2024 and sell it today you would earn a total of 280.00 from holding Tsingtao Brewery or generate 75.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tsingtao Brewery vs. CREO MEDICAL GRP
Performance |
| Timeline |
| Tsingtao Brewery |
| CREO MEDICAL GRP |
Tsingtao Brewery and CREO MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tsingtao Brewery and CREO MEDICAL
The main advantage of trading using opposite Tsingtao Brewery and CREO MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tsingtao Brewery position performs unexpectedly, CREO MEDICAL 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 CREO MEDICAL will offset losses from the drop in CREO MEDICAL's long position.| Tsingtao Brewery vs. New Residential Investment | Tsingtao Brewery vs. Siamgas And Petrochemicals | Tsingtao Brewery vs. NorAm Drilling AS | Tsingtao Brewery vs. HK Electric Investments |
| CREO MEDICAL vs. Apple Inc | CREO MEDICAL vs. Apple Inc | CREO MEDICAL vs. Apple Inc | CREO MEDICAL vs. Apple 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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