Correlation Between Dongguan Tarry and China Shenhua
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By analyzing existing cross correlation between Dongguan Tarry Electronics and China Shenhua Energy, you can compare the effects of market volatilities on Dongguan Tarry and China Shenhua 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 Dongguan Tarry with a short position of China Shenhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongguan Tarry and China Shenhua.
Diversification Opportunities for Dongguan Tarry and China Shenhua
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dongguan and China is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Dongguan Tarry Electronics and China Shenhua Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Shenhua Energy and Dongguan Tarry 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 Dongguan Tarry Electronics are associated (or correlated) with China Shenhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Shenhua Energy has no effect on the direction of Dongguan Tarry i.e., Dongguan Tarry and China Shenhua go up and down completely randomly.
Pair Corralation between Dongguan Tarry and China Shenhua
Assuming the 90 days trading horizon Dongguan Tarry Electronics is expected to generate 2.2 times more return on investment than China Shenhua. However, Dongguan Tarry is 2.2 times more volatile than China Shenhua Energy. It trades about 0.0 of its potential returns per unit of risk. China Shenhua Energy is currently generating about -0.29 per unit of risk. If you would invest 7,195 in Dongguan Tarry Electronics on October 25, 2024 and sell it today you would lose (73.00) from holding Dongguan Tarry Electronics or give up 1.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongguan Tarry Electronics vs. China Shenhua Energy
Performance |
| Timeline |
| Dongguan Tarry Elect |
| China Shenhua Energy |
Dongguan Tarry and China Shenhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongguan Tarry and China Shenhua
The main advantage of trading using opposite Dongguan Tarry and China Shenhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongguan Tarry position performs unexpectedly, China Shenhua 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 China Shenhua will offset losses from the drop in China Shenhua's long position.| Dongguan Tarry vs. China Aluminum International | Dongguan Tarry vs. Anhui Transport Consulting | Dongguan Tarry vs. Jinhe Biotechnology Co | Dongguan Tarry vs. Changchun BCHT Biotechnology |
| China Shenhua vs. Qingdao Foods Co | China Shenhua vs. Dongguan Tarry Electronics | China Shenhua vs. Beijing YanDong MicroElectronic | China Shenhua vs. Success Electronics |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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