Correlation Between Tieling Newcity and Guangdong Jingyi
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By analyzing existing cross correlation between Tieling Newcity Investment and Guangdong Jingyi Metal, you can compare the effects of market volatilities on Tieling Newcity and Guangdong Jingyi 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 Tieling Newcity with a short position of Guangdong Jingyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tieling Newcity and Guangdong Jingyi.
Diversification Opportunities for Tieling Newcity and Guangdong Jingyi
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tieling and Guangdong is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Tieling Newcity Investment and Guangdong Jingyi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Jingyi Metal and Tieling Newcity 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 Tieling Newcity Investment are associated (or correlated) with Guangdong Jingyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Jingyi Metal has no effect on the direction of Tieling Newcity i.e., Tieling Newcity and Guangdong Jingyi go up and down completely randomly.
Pair Corralation between Tieling Newcity and Guangdong Jingyi
Assuming the 90 days trading horizon Tieling Newcity Investment is expected to generate 1.06 times more return on investment than Guangdong Jingyi. However, Tieling Newcity is 1.06 times more volatile than Guangdong Jingyi Metal. It trades about 0.22 of its potential returns per unit of risk. Guangdong Jingyi Metal is currently generating about 0.07 per unit of risk. If you would invest 223.00 in Tieling Newcity Investment on October 13, 2024 and sell it today you would earn a total of 101.00 from holding Tieling Newcity Investment or generate 45.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Tieling Newcity Investment vs. Guangdong Jingyi Metal
Performance |
Timeline |
Tieling Newcity Inve |
Guangdong Jingyi Metal |
Tieling Newcity and Guangdong Jingyi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tieling Newcity and Guangdong Jingyi
The main advantage of trading using opposite Tieling Newcity and Guangdong Jingyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tieling Newcity position performs unexpectedly, Guangdong Jingyi 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 Guangdong Jingyi will offset losses from the drop in Guangdong Jingyi's long position.Tieling Newcity vs. Fujian Nanwang Environment | ||
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