Correlation Between Jiangxi Naipu and Dalian Thermal
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By analyzing existing cross correlation between Jiangxi Naipu Mining and Dalian Thermal Power, you can compare the effects of market volatilities on Jiangxi Naipu 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 Jiangxi Naipu with a short position of Dalian Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Naipu and Dalian Thermal.
Diversification Opportunities for Jiangxi Naipu and Dalian Thermal
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiangxi and Dalian is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Naipu Mining 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 Jiangxi Naipu 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 Jiangxi Naipu Mining 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 Jiangxi Naipu i.e., Jiangxi Naipu and Dalian Thermal go up and down completely randomly.
Pair Corralation between Jiangxi Naipu and Dalian Thermal
Assuming the 90 days trading horizon Jiangxi Naipu Mining is expected to generate 0.65 times more return on investment than Dalian Thermal. However, Jiangxi Naipu Mining is 1.54 times less risky than Dalian Thermal. It trades about 0.03 of its potential returns per unit of risk. Dalian Thermal Power is currently generating about 0.01 per unit of risk. If you would invest 2,735 in Jiangxi Naipu Mining on August 31, 2024 and sell it today you would earn a total of 137.00 from holding Jiangxi Naipu Mining or generate 5.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Naipu Mining vs. Dalian Thermal Power
Performance |
| Timeline |
| Jiangxi Naipu Mining |
| Dalian Thermal Power |
Jiangxi Naipu and Dalian Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Naipu and Dalian Thermal
The main advantage of trading using opposite Jiangxi Naipu and Dalian Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Naipu 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.| Jiangxi Naipu vs. Cultural Investment Holdings | Jiangxi Naipu vs. Gome Telecom Equipment | Jiangxi Naipu vs. Bus Online Co | Jiangxi Naipu vs. Holitech Technology Co |
| Dalian Thermal vs. Industrial and Commercial | Dalian Thermal vs. Kweichow Moutai Co | Dalian Thermal vs. Agricultural Bank of | Dalian Thermal vs. China Mobile Limited |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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