Correlation Between Shenyang Huitian and Zhengzhou Coal
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By analyzing existing cross correlation between Shenyang Huitian Thermal and Zhengzhou Coal Mining, you can compare the effects of market volatilities on Shenyang Huitian and Zhengzhou Coal 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 Shenyang Huitian with a short position of Zhengzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Huitian and Zhengzhou Coal.
Diversification Opportunities for Shenyang Huitian and Zhengzhou Coal
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shenyang and Zhengzhou is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Huitian Thermal and Zhengzhou Coal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengzhou Coal Mining and Shenyang Huitian 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 Shenyang Huitian Thermal are associated (or correlated) with Zhengzhou Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengzhou Coal Mining has no effect on the direction of Shenyang Huitian i.e., Shenyang Huitian and Zhengzhou Coal go up and down completely randomly.
Pair Corralation between Shenyang Huitian and Zhengzhou Coal
Assuming the 90 days trading horizon Shenyang Huitian Thermal is expected to under-perform the Zhengzhou Coal. In addition to that, Shenyang Huitian is 5.23 times more volatile than Zhengzhou Coal Mining. It trades about -0.16 of its total potential returns per unit of risk. Zhengzhou Coal Mining is currently generating about -0.14 per unit of volatility. If you would invest 1,293 in Zhengzhou Coal Mining on October 14, 2024 and sell it today you would lose (34.00) from holding Zhengzhou Coal Mining or give up 2.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenyang Huitian Thermal vs. Zhengzhou Coal Mining
Performance |
| Timeline |
| Shenyang Huitian Thermal |
| Zhengzhou Coal Mining |
Shenyang Huitian and Zhengzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Huitian and Zhengzhou Coal
The main advantage of trading using opposite Shenyang Huitian and Zhengzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Huitian position performs unexpectedly, Zhengzhou Coal 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 Zhengzhou Coal will offset losses from the drop in Zhengzhou Coal's long position.| Shenyang Huitian vs. Jointo Energy Investment | Shenyang Huitian vs. Ningxia Younglight Chemicals | Shenyang Huitian vs. Kunwu Jiuding Investment | Shenyang Huitian vs. Ningbo Ligong Online |
| Zhengzhou Coal vs. Shanghai Ziyan Foods | Zhengzhou Coal vs. Kuangda Technology Group | Zhengzhou Coal vs. Jiahe Foods Industry | Zhengzhou Coal vs. Linewell Software Co |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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