Correlation Between New Hope and Tianjin Silvery
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By analyzing existing cross correlation between New Hope Dairy and Tianjin Silvery Dragon, you can compare the effects of market volatilities on New Hope and Tianjin Silvery 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 New Hope with a short position of Tianjin Silvery. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Hope and Tianjin Silvery.
Diversification Opportunities for New Hope and Tianjin Silvery
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between New and Tianjin is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding New Hope Dairy and Tianjin Silvery Dragon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Silvery Dragon and New Hope 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 New Hope Dairy are associated (or correlated) with Tianjin Silvery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Silvery Dragon has no effect on the direction of New Hope i.e., New Hope and Tianjin Silvery go up and down completely randomly.
Pair Corralation between New Hope and Tianjin Silvery
Assuming the 90 days trading horizon New Hope Dairy is expected to generate 0.92 times more return on investment than Tianjin Silvery. However, New Hope Dairy is 1.09 times less risky than Tianjin Silvery. It trades about 0.15 of its potential returns per unit of risk. Tianjin Silvery Dragon is currently generating about 0.06 per unit of risk. If you would invest 1,363 in New Hope Dairy on October 6, 2024 and sell it today you would earn a total of 147.00 from holding New Hope Dairy or generate 10.79% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
New Hope Dairy vs. Tianjin Silvery Dragon
Performance |
Timeline |
New Hope Dairy |
Tianjin Silvery Dragon |
New Hope and Tianjin Silvery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with New Hope and Tianjin Silvery
The main advantage of trading using opposite New Hope and Tianjin Silvery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Hope position performs unexpectedly, Tianjin Silvery 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 Tianjin Silvery will offset losses from the drop in Tianjin Silvery's long position.New Hope vs. Shaanxi Construction Machinery | New Hope vs. Haima Automobile Group | New Hope vs. Xingguang Agricultural Mach | New Hope vs. Hunan Tyen Machinery |
Tianjin Silvery vs. Zijin Mining Group | Tianjin Silvery vs. Wanhua Chemical Group | Tianjin Silvery vs. Baoshan Iron Steel | Tianjin Silvery vs. Shandong Gold Mining |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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