Correlation Between Dawning Information and Tongyu Communication
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By analyzing existing cross correlation between Dawning Information Industry and Tongyu Communication, you can compare the effects of market volatilities on Dawning Information and Tongyu Communication 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 Dawning Information with a short position of Tongyu Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dawning Information and Tongyu Communication.
Diversification Opportunities for Dawning Information and Tongyu Communication
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dawning and Tongyu is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Dawning Information Industry and Tongyu Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongyu Communication and Dawning Information 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 Dawning Information Industry are associated (or correlated) with Tongyu Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongyu Communication has no effect on the direction of Dawning Information i.e., Dawning Information and Tongyu Communication go up and down completely randomly.
Pair Corralation between Dawning Information and Tongyu Communication
Assuming the 90 days trading horizon Dawning Information Industry is expected to generate 1.11 times more return on investment than Tongyu Communication. However, Dawning Information is 1.11 times more volatile than Tongyu Communication. It trades about 0.32 of its potential returns per unit of risk. Tongyu Communication is currently generating about 0.21 per unit of risk. If you would invest 3,452 in Dawning Information Industry on September 7, 2024 and sell it today you would earn a total of 4,143 from holding Dawning Information Industry or generate 120.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Dawning Information Industry vs. Tongyu Communication
Performance |
Timeline |
Dawning Information |
Tongyu Communication |
Dawning Information and Tongyu Communication Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dawning Information and Tongyu Communication
The main advantage of trading using opposite Dawning Information and Tongyu Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dawning Information position performs unexpectedly, Tongyu Communication 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 Tongyu Communication will offset losses from the drop in Tongyu Communication's long position.Dawning Information vs. Ningbo Thermal Power | Dawning Information vs. Chengdu B ray Media | Dawning Information vs. Hefei Metalforming Mach | Dawning Information vs. Beijing HuaYuanYiTong Thermal |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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