Correlation Between Tongyu Communication and BYD Co
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By analyzing existing cross correlation between Tongyu Communication and BYD Co Ltd, you can compare the effects of market volatilities on Tongyu Communication and BYD Co 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 Tongyu Communication with a short position of BYD Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongyu Communication and BYD Co.
Diversification Opportunities for Tongyu Communication and BYD Co
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tongyu and BYD is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Tongyu Communication and BYD Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BYD Co and Tongyu Communication 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 Tongyu Communication are associated (or correlated) with BYD Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BYD Co has no effect on the direction of Tongyu Communication i.e., Tongyu Communication and BYD Co go up and down completely randomly.
Pair Corralation between Tongyu Communication and BYD Co
Assuming the 90 days trading horizon Tongyu Communication is expected to under-perform the BYD Co. But the stock apears to be less risky and, when comparing its historical volatility, Tongyu Communication is 1.03 times less risky than BYD Co. The stock trades about -0.06 of its potential returns per unit of risk. The BYD Co Ltd is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 28,499 in BYD Co Ltd on December 30, 2024 and sell it today you would earn a total of 9,751 from holding BYD Co Ltd or generate 34.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Tongyu Communication vs. BYD Co Ltd
Performance |
Timeline |
Tongyu Communication |
BYD Co |
Tongyu Communication and BYD Co Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tongyu Communication and BYD Co
The main advantage of trading using opposite Tongyu Communication and BYD Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongyu Communication position performs unexpectedly, BYD Co 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 BYD Co will offset losses from the drop in BYD Co's long position.Tongyu Communication vs. Shanghai Jinfeng Wine | Tongyu Communication vs. GRG Banking Equipment | Tongyu Communication vs. HeNan Splendor Science | Tongyu Communication vs. Nancal Energy Saving Tech |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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