Correlation Between Tianjin Realty and Tianjin Pengling
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By analyzing existing cross correlation between Tianjin Realty Development and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Tianjin Realty 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 Tianjin Realty with a short position of Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Realty and Tianjin Pengling.
Diversification Opportunities for Tianjin Realty and Tianjin Pengling
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tianjin and Tianjin is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Realty Development 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 Tianjin Realty 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 Tianjin Realty Development 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 Tianjin Realty i.e., Tianjin Realty and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Tianjin Realty and Tianjin Pengling
Assuming the 90 days trading horizon Tianjin Realty Development is expected to generate 1.4 times more return on investment than Tianjin Pengling. However, Tianjin Realty is 1.4 times more volatile than Tianjin Pengling Rubber. It trades about 0.26 of its potential returns per unit of risk. Tianjin Pengling Rubber is currently generating about 0.15 per unit of risk. If you would invest 130.00 in Tianjin Realty Development on September 8, 2024 and sell it today you would earn a total of 139.00 from holding Tianjin Realty Development or generate 106.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Tianjin Realty Development vs. Tianjin Pengling Rubber
Performance |
Timeline |
Tianjin Realty Devel |
Tianjin Pengling Rubber |
Tianjin Realty and Tianjin Pengling Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tianjin Realty and Tianjin Pengling
The main advantage of trading using opposite Tianjin Realty and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Realty 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.Tianjin Realty vs. Heilongjiang Publishing Media | Tianjin Realty vs. Changjiang Publishing Media | Tianjin Realty vs. China World Trade | Tianjin Realty vs. Yingde Greatchem Chemicals |
Tianjin Pengling vs. Holitech Technology Co | Tianjin Pengling vs. AVIC Fund Management | Tianjin Pengling vs. OBiO Technology Corp | Tianjin Pengling vs. Maxvision Technology Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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