Correlation Between Dirui Industrial and Tianjin Pengling
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By analyzing existing cross correlation between Dirui Industrial Co and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Dirui Industrial and Tianjin Pengling 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 Dirui Industrial with a short position of Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dirui Industrial and Tianjin Pengling.
Diversification Opportunities for Dirui Industrial and Tianjin Pengling
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dirui and Tianjin is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Dirui Industrial Co and Tianjin Pengling Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Pengling Rubber and Dirui Industrial 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 Dirui Industrial Co are associated (or correlated) with Tianjin Pengling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Pengling Rubber has no effect on the direction of Dirui Industrial i.e., Dirui Industrial and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Dirui Industrial and Tianjin Pengling
Assuming the 90 days trading horizon Dirui Industrial Co is expected to under-perform the Tianjin Pengling. But the stock apears to be less risky and, when comparing its historical volatility, Dirui Industrial Co is 1.16 times less risky than Tianjin Pengling. The stock trades about -0.01 of its potential returns per unit of risk. The Tianjin Pengling Rubber is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 357.00 in Tianjin Pengling Rubber on September 7, 2024 and sell it today you would earn a total of 176.00 from holding Tianjin Pengling Rubber or generate 49.3% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Dirui Industrial Co vs. Tianjin Pengling Rubber
Performance |
Timeline |
Dirui Industrial |
Tianjin Pengling Rubber |
Dirui Industrial and Tianjin Pengling Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dirui Industrial and Tianjin Pengling
The main advantage of trading using opposite Dirui Industrial and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dirui Industrial position performs unexpectedly, Tianjin Pengling 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 Pengling will offset losses from the drop in Tianjin Pengling's long position.Dirui Industrial vs. Cultural Investment Holdings | Dirui Industrial vs. Gome Telecom Equipment | Dirui Industrial vs. Bus Online Co | Dirui Industrial vs. Holitech Technology Co |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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