Correlation Between Cambricon Technologies and Tonghua Grape
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By analyzing existing cross correlation between Cambricon Technologies Corp and Tonghua Grape Wine, you can compare the effects of market volatilities on Cambricon Technologies and Tonghua Grape 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 Cambricon Technologies with a short position of Tonghua Grape. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambricon Technologies and Tonghua Grape.
Diversification Opportunities for Cambricon Technologies and Tonghua Grape
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cambricon and Tonghua is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Cambricon Technologies Corp and Tonghua Grape Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tonghua Grape Wine and Cambricon Technologies 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 Cambricon Technologies Corp are associated (or correlated) with Tonghua Grape. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tonghua Grape Wine has no effect on the direction of Cambricon Technologies i.e., Cambricon Technologies and Tonghua Grape go up and down completely randomly.
Pair Corralation between Cambricon Technologies and Tonghua Grape
Assuming the 90 days trading horizon Cambricon Technologies Corp is expected to generate 1.42 times more return on investment than Tonghua Grape. However, Cambricon Technologies is 1.42 times more volatile than Tonghua Grape Wine. It trades about 0.13 of its potential returns per unit of risk. Tonghua Grape Wine is currently generating about -0.17 per unit of risk. If you would invest 57,012 in Cambricon Technologies Corp on October 6, 2024 and sell it today you would earn a total of 5,088 from holding Cambricon Technologies Corp or generate 8.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Cambricon Technologies Corp vs. Tonghua Grape Wine
Performance |
Timeline |
Cambricon Technologies |
Tonghua Grape Wine |
Cambricon Technologies and Tonghua Grape Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cambricon Technologies and Tonghua Grape
The main advantage of trading using opposite Cambricon Technologies and Tonghua Grape positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambricon Technologies position performs unexpectedly, Tonghua Grape 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 Tonghua Grape will offset losses from the drop in Tonghua Grape's long position.Cambricon Technologies vs. Servyou Software Group | Cambricon Technologies vs. Hangzhou Pinming Software | Cambricon Technologies vs. Glodon Software Co | Cambricon Technologies vs. Dareway Software 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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