Correlation Between CHINA TONTINE and Vanguard Funds

Can any of the company-specific risk be diversified away by investing in both CHINA TONTINE and Vanguard Funds at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining CHINA TONTINE and Vanguard Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CHINA TONTINE WINES and Vanguard Funds Public, you can compare the effects of market volatilities on CHINA TONTINE and Vanguard Funds 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 CHINA TONTINE with a short position of Vanguard Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA TONTINE and Vanguard Funds.

Diversification Opportunities for CHINA TONTINE and Vanguard Funds

0.0

Correlation Coefficient

CHINA TONTINE  Vanguard Funds

Pay attention - limited upside

The 3 months correlation between CHINA and Vanguard is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHINA TONTINE WINES and Vanguard Funds Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Funds Public and CHINA TONTINE 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 CHINA TONTINE WINES are associated (or correlated) with Vanguard Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Funds Public has no effect on the direction of CHINA TONTINE i.e., CHINA TONTINE and Vanguard Funds go up and down completely randomly.

Pair Corralation between CHINA TONTINE and Vanguard Funds

If you would invest  9,724  in Vanguard Funds Public on September 23, 2024 and sell it today you would earn a total of  1,090  from holding Vanguard Funds Public or generate 11.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

CHINA TONTINE WINES  vs.  Vanguard Funds Public

CHINA TONTINE WINES

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CHINA TONTINE WINES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, CHINA TONTINE is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Vanguard Funds Public

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Funds Public are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Vanguard Funds may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with CHINA TONTINE and Vanguard Funds

The main advantage of trading using opposite CHINA TONTINE and Vanguard Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA TONTINE position performs unexpectedly, Vanguard Funds 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 Vanguard Funds will offset losses from the drop in Vanguard Funds' long position.

The idea behind CHINA TONTINE WINES and Vanguard Funds Public pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.