Correlation Between Chongqing Brewery and Chengtun Mining
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By analyzing existing cross correlation between Chongqing Brewery Co and Chengtun Mining Group, you can compare the effects of market volatilities on Chongqing Brewery 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 Chongqing Brewery with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Brewery and Chengtun Mining.
Diversification Opportunities for Chongqing Brewery and Chengtun Mining
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chongqing and Chengtun is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Brewery Co 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 Chongqing Brewery 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 Chongqing Brewery Co 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 Chongqing Brewery i.e., Chongqing Brewery and Chengtun Mining go up and down completely randomly.
Pair Corralation between Chongqing Brewery and Chengtun Mining
Assuming the 90 days trading horizon Chongqing Brewery Co is expected to under-perform the Chengtun Mining. But the stock apears to be less risky and, when comparing its historical volatility, Chongqing Brewery Co is 1.13 times less risky than Chengtun Mining. The stock trades about -0.06 of its potential returns per unit of risk. The Chengtun Mining Group is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 641.00 in Chengtun Mining Group on October 27, 2024 and sell it today you would lose (136.00) from holding Chengtun Mining Group or give up 21.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Brewery Co vs. Chengtun Mining Group
Performance |
| Timeline |
| Chongqing Brewery |
| Chengtun Mining Group |
Chongqing Brewery and Chengtun Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Brewery and Chengtun Mining
The main advantage of trading using opposite Chongqing Brewery and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Brewery 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.| Chongqing Brewery vs. Wintao Communications Co | Chongqing Brewery vs. Tianjin Hi Tech Development | Chongqing Brewery vs. Beijing Seeyon Internet | Chongqing Brewery vs. Guangzhou Dongfang Hotel |
| Chengtun Mining vs. Hainan Airlines Co | Chengtun Mining vs. Juneyao Airlines | Chengtun Mining vs. Longjian Road Bridge | Chengtun Mining vs. Zhongshan Broad Ocean Motor |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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