Correlation Between Eit Environmental and Tjk Machinery
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By analyzing existing cross correlation between Eit Environmental Development and Tjk Machinery Tianjin, you can compare the effects of market volatilities on Eit Environmental and Tjk Machinery 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 Eit Environmental with a short position of Tjk Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eit Environmental and Tjk Machinery.
Diversification Opportunities for Eit Environmental and Tjk Machinery
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eit and Tjk is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Eit Environmental Development and Tjk Machinery Tianjin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tjk Machinery Tianjin and Eit Environmental 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 Eit Environmental Development are associated (or correlated) with Tjk Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tjk Machinery Tianjin has no effect on the direction of Eit Environmental i.e., Eit Environmental and Tjk Machinery go up and down completely randomly.
Pair Corralation between Eit Environmental and Tjk Machinery
Assuming the 90 days trading horizon Eit Environmental Development is expected to generate 1.04 times more return on investment than Tjk Machinery. However, Eit Environmental is 1.04 times more volatile than Tjk Machinery Tianjin. It trades about 0.14 of its potential returns per unit of risk. Tjk Machinery Tianjin is currently generating about 0.11 per unit of risk. If you would invest 1,199 in Eit Environmental Development on September 26, 2024 and sell it today you would earn a total of 417.00 from holding Eit Environmental Development or generate 34.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Eit Environmental Development vs. Tjk Machinery Tianjin
Performance |
Timeline |
Eit Environmental |
Tjk Machinery Tianjin |
Eit Environmental and Tjk Machinery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eit Environmental and Tjk Machinery
The main advantage of trading using opposite Eit Environmental and Tjk Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eit Environmental position performs unexpectedly, Tjk Machinery 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 Tjk Machinery will offset losses from the drop in Tjk Machinery's long position.Eit Environmental vs. Ming Yang Smart | Eit Environmental vs. 159681 | Eit Environmental vs. 159005 | Eit Environmental vs. Loctek Ergonomic Technology |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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