Correlation Between Fushun Special and Tianjin Pengling
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By analyzing existing cross correlation between Fushun Special Steel and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Fushun Special 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 Fushun Special with a short position of Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fushun Special and Tianjin Pengling.
Diversification Opportunities for Fushun Special and Tianjin Pengling
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fushun and Tianjin is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Fushun Special Steel 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 Fushun Special 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 Fushun Special Steel 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 Fushun Special i.e., Fushun Special and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Fushun Special and Tianjin Pengling
Assuming the 90 days trading horizon Fushun Special Steel is expected to under-perform the Tianjin Pengling. But the stock apears to be less risky and, when comparing its historical volatility, Fushun Special Steel is 1.08 times less risky than Tianjin Pengling. The stock trades about -0.16 of its potential returns per unit of risk. The Tianjin Pengling Rubber is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 508.00 in Tianjin Pengling Rubber on September 7, 2024 and sell it today you would earn a total of 25.00 from holding Tianjin Pengling Rubber or generate 4.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Fushun Special Steel vs. Tianjin Pengling Rubber
Performance |
Timeline |
Fushun Special Steel |
Tianjin Pengling Rubber |
Fushun Special and Tianjin Pengling Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fushun Special and Tianjin Pengling
The main advantage of trading using opposite Fushun Special and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fushun Special 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.Fushun Special vs. Zijin Mining Group | Fushun Special vs. Wanhua Chemical Group | Fushun Special vs. Baoshan Iron Steel | Fushun Special vs. Rongsheng Petrochemical 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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