Correlation Between TES TOUCH and LINGYI ITECH

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Can any of the company-specific risk be diversified away by investing in both TES TOUCH and LINGYI ITECH 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 TES TOUCH and LINGYI ITECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TES TOUCH EMBEDDED and LINGYI ITECH GUAN, you can compare the effects of market volatilities on TES TOUCH and LINGYI ITECH 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 TES TOUCH with a short position of LINGYI ITECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of TES TOUCH and LINGYI ITECH.

Diversification Opportunities for TES TOUCH and LINGYI ITECH

0.85
  Correlation Coefficient

Very poor diversification

The 3 months correlation between 003019 and LINGYI is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding TES TOUCH EMBEDDED and LINGYI ITECH GUAN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LINGYI ITECH GUAN and TES TOUCH 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 TES TOUCH EMBEDDED are associated (or correlated) with LINGYI ITECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LINGYI ITECH GUAN has no effect on the direction of TES TOUCH i.e., TES TOUCH and LINGYI ITECH go up and down completely randomly.

Pair Corralation between TES TOUCH and LINGYI ITECH

Assuming the 90 days trading horizon TES TOUCH is expected to generate 1.62 times less return on investment than LINGYI ITECH. In addition to that, TES TOUCH is 1.0 times more volatile than LINGYI ITECH GUAN. It trades about 0.01 of its total potential returns per unit of risk. LINGYI ITECH GUAN is currently generating about 0.02 per unit of volatility. If you would invest  469.00  in LINGYI ITECH GUAN on August 29, 2022 and sell it today you would earn a total of  14.00  from holding LINGYI ITECH GUAN or generate 2.99% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy98.1%
ValuesDaily Returns

TES TOUCH EMBEDDED  vs.  LINGYI ITECH GUAN

 Performance (%) 
       Timeline  
TES TOUCH EMBEDDED 
003019 Performance
0 of 100
Over the last 90 days TES TOUCH EMBEDDED has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

003019 Price Channel

LINGYI ITECH GUAN 
LINGYI Performance
0 of 100
Over the last 90 days LINGYI ITECH GUAN has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in December 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

LINGYI Price Channel

TES TOUCH and LINGYI ITECH Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with TES TOUCH and LINGYI ITECH

The main advantage of trading using opposite TES TOUCH and LINGYI ITECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TES TOUCH position performs unexpectedly, LINGYI ITECH 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 LINGYI ITECH will offset losses from the drop in LINGYI ITECH's long position.
TES TOUCH vs. JUTZE INTELLIGENT
TES TOUCH vs. ZHEJIANG FIRSTAR
TES TOUCH vs. GUIYANG XINTIAN PH
The idea behind TES TOUCH EMBEDDED and LINGYI ITECH GUAN 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.
LINGYI ITECH vs. JUTZE INTELLIGENT
LINGYI ITECH vs. TES TOUCH EMBEDDED
LINGYI ITECH vs. ZHEJIANG FIRSTAR
LINGYI ITECH vs. GUIYANG XINTIAN PH
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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