Correlation Between Tongyu Communication and Gan Yuan
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By analyzing existing cross correlation between Tongyu Communication and Gan Yuan Foods, you can compare the effects of market volatilities on Tongyu Communication and Gan Yuan 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 Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongyu Communication and Gan Yuan.
Diversification Opportunities for Tongyu Communication and Gan Yuan
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tongyu and Gan is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Tongyu Communication and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods 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 Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Tongyu Communication i.e., Tongyu Communication and Gan Yuan go up and down completely randomly.
Pair Corralation between Tongyu Communication and Gan Yuan
Assuming the 90 days trading horizon Tongyu Communication is expected to under-perform the Gan Yuan. But the stock apears to be less risky and, when comparing its historical volatility, Tongyu Communication is 1.41 times less risky than Gan Yuan. The stock trades about -0.23 of its potential returns per unit of risk. The Gan Yuan Foods is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 7,310 in Gan Yuan Foods on September 25, 2024 and sell it today you would earn a total of 1,235 from holding Gan Yuan Foods or generate 16.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Tongyu Communication vs. Gan Yuan Foods
Performance |
Timeline |
Tongyu Communication |
Gan Yuan Foods |
Tongyu Communication and Gan Yuan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tongyu Communication and Gan Yuan
The main advantage of trading using opposite Tongyu Communication and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongyu Communication position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.Tongyu Communication vs. Ningbo Homelink Eco iTech | Tongyu Communication vs. Hunan TV Broadcast | Tongyu Communication vs. Heilongjiang Transport Development | Tongyu Communication vs. Xiamen Goldenhome Co |
Gan Yuan vs. Ligao Foods CoLtd | Gan Yuan vs. Anji Foodstuff Co | Gan Yuan vs. Xinjiang Communications Construction | Gan Yuan vs. Tongyu Communication |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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