Correlation Between Heilongjiang Publishing and Tianjin Pengling
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By analyzing existing cross correlation between Heilongjiang Publishing Media and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Heilongjiang Publishing 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 Heilongjiang Publishing with a short position of Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heilongjiang Publishing and Tianjin Pengling.
Diversification Opportunities for Heilongjiang Publishing and Tianjin Pengling
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Heilongjiang and Tianjin is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Heilongjiang Publishing Media 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 Heilongjiang Publishing 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 Heilongjiang Publishing Media 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 Heilongjiang Publishing i.e., Heilongjiang Publishing and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Heilongjiang Publishing and Tianjin Pengling
Assuming the 90 days trading horizon Heilongjiang Publishing is expected to generate 1.11 times less return on investment than Tianjin Pengling. But when comparing it to its historical volatility, Heilongjiang Publishing Media is 1.08 times less risky than Tianjin Pengling. It trades about 0.15 of its potential returns per unit of risk. Tianjin Pengling Rubber is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 394.00 in Tianjin Pengling Rubber on September 7, 2024 and sell it today you would earn a total of 139.00 from holding Tianjin Pengling Rubber or generate 35.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Heilongjiang Publishing Media vs. Tianjin Pengling Rubber
Performance |
Timeline |
Heilongjiang Publishing |
Tianjin Pengling Rubber |
Heilongjiang Publishing and Tianjin Pengling Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Heilongjiang Publishing and Tianjin Pengling
The main advantage of trading using opposite Heilongjiang Publishing and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heilongjiang Publishing 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.Heilongjiang Publishing vs. Kweichow Moutai Co | Heilongjiang Publishing vs. China Mobile Limited | Heilongjiang Publishing vs. Contemporary Amperex Technology | Heilongjiang Publishing vs. Bosera ChiNext ETF |
Tianjin Pengling vs. Jointo Energy Investment | Tianjin Pengling vs. Jinhui Liquor Co | Tianjin Pengling vs. Kunwu Jiuding Investment | Tianjin Pengling vs. Jiangsu Yueda Investment |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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