Correlation Between Central Plains and Dalian Thermal
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By analyzing existing cross correlation between Central Plains Environment and Dalian Thermal Power, you can compare the effects of market volatilities on Central Plains and Dalian Thermal 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 Central Plains with a short position of Dalian Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Plains and Dalian Thermal.
Diversification Opportunities for Central Plains and Dalian Thermal
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Central and Dalian is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Central Plains Environment and Dalian Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalian Thermal Power and Central Plains 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 Central Plains Environment are associated (or correlated) with Dalian Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalian Thermal Power has no effect on the direction of Central Plains i.e., Central Plains and Dalian Thermal go up and down completely randomly.
Pair Corralation between Central Plains and Dalian Thermal
Assuming the 90 days trading horizon Central Plains Environment is expected to generate 0.51 times more return on investment than Dalian Thermal. However, Central Plains Environment is 1.98 times less risky than Dalian Thermal. It trades about 0.13 of its potential returns per unit of risk. Dalian Thermal Power is currently generating about -0.03 per unit of risk. If you would invest 839.00 in Central Plains Environment on November 6, 2024 and sell it today you would earn a total of 20.00 from holding Central Plains Environment or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Plains Environment vs. Dalian Thermal Power
Performance |
| Timeline |
| Central Plains Envir |
| Dalian Thermal Power |
Central Plains and Dalian Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Plains and Dalian Thermal
The main advantage of trading using opposite Central Plains and Dalian Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Plains position performs unexpectedly, Dalian Thermal 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 Dalian Thermal will offset losses from the drop in Dalian Thermal's long position.| Central Plains vs. Fibocom Wireless | Central Plains vs. Bomesc Offshore Engineering | Central Plains vs. Queclink Wireless Solutions | Central Plains vs. Sharetronic Data Technology |
| Dalian Thermal vs. Shuhua Sports Co | Dalian Thermal vs. Hengdian Entertainment Co | Dalian Thermal vs. Quectel Wireless Solutions | Dalian Thermal vs. Guangzhou Jinyi Media |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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