Correlation Between Guangdong Tengen and Chengtun Mining
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By analyzing existing cross correlation between Guangdong Tengen Industrial and Chengtun Mining Group, you can compare the effects of market volatilities on Guangdong Tengen and Chengtun Mining 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 Guangdong Tengen with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Tengen and Chengtun Mining.
Diversification Opportunities for Guangdong Tengen and Chengtun Mining
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guangdong and Chengtun is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Tengen Industrial and Chengtun Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengtun Mining Group and Guangdong Tengen 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 Guangdong Tengen Industrial are associated (or correlated) with Chengtun Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengtun Mining Group has no effect on the direction of Guangdong Tengen i.e., Guangdong Tengen and Chengtun Mining go up and down completely randomly.
Pair Corralation between Guangdong Tengen and Chengtun Mining
Assuming the 90 days trading horizon Guangdong Tengen Industrial is expected to under-perform the Chengtun Mining. In addition to that, Guangdong Tengen is 2.38 times more volatile than Chengtun Mining Group. It trades about -0.02 of its total potential returns per unit of risk. Chengtun Mining Group is currently generating about 0.12 per unit of volatility. If you would invest 487.00 in Chengtun Mining Group on November 3, 2024 and sell it today you would earn a total of 19.00 from holding Chengtun Mining Group or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Tengen Industrial vs. Chengtun Mining Group
Performance |
| Timeline |
| Guangdong Tengen Ind |
| Chengtun Mining Group |
Guangdong Tengen and Chengtun Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Tengen and Chengtun Mining
The main advantage of trading using opposite Guangdong Tengen and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Tengen position performs unexpectedly, Chengtun Mining 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 Chengtun Mining will offset losses from the drop in Chengtun Mining's long position.| Guangdong Tengen vs. Zijin Mining Group | Guangdong Tengen vs. Wanhua Chemical Group | Guangdong Tengen vs. Baoshan Iron Steel | Guangdong Tengen vs. Shandong Gold Mining |
| Chengtun Mining vs. Zijin Mining Group | Chengtun Mining vs. Wanhua Chemical Group | Chengtun Mining vs. Baoshan Iron Steel | Chengtun Mining vs. Shandong Gold Mining |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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