Correlation Between Pengxin International and Dongguan Chitwing
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By analyzing existing cross correlation between Pengxin International Mining and Dongguan Chitwing Technology, you can compare the effects of market volatilities on Pengxin International and Dongguan Chitwing 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 Pengxin International with a short position of Dongguan Chitwing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and Dongguan Chitwing.
Diversification Opportunities for Pengxin International and Dongguan Chitwing
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pengxin and Dongguan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and Dongguan Chitwing Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Chitwing and Pengxin International 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 Pengxin International Mining are associated (or correlated) with Dongguan Chitwing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Chitwing has no effect on the direction of Pengxin International i.e., Pengxin International and Dongguan Chitwing go up and down completely randomly.
Pair Corralation between Pengxin International and Dongguan Chitwing
Assuming the 90 days trading horizon Pengxin International is expected to generate 1.76 times less return on investment than Dongguan Chitwing. But when comparing it to its historical volatility, Pengxin International Mining is 1.55 times less risky than Dongguan Chitwing. It trades about 0.06 of its potential returns per unit of risk. Dongguan Chitwing Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,337 in Dongguan Chitwing Technology on August 28, 2024 and sell it today you would earn a total of 100.00 from holding Dongguan Chitwing Technology or generate 4.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pengxin International Mining vs. Dongguan Chitwing Technology
Performance |
| Timeline |
| Pengxin International |
| Dongguan Chitwing |
Pengxin International and Dongguan Chitwing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pengxin International and Dongguan Chitwing
The main advantage of trading using opposite Pengxin International and Dongguan Chitwing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, Dongguan Chitwing 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 Dongguan Chitwing will offset losses from the drop in Dongguan Chitwing's long position.| Pengxin International vs. Wanhua Chemical Group | Pengxin International vs. Shandong Gold Mining | Pengxin International vs. Rongsheng Petrochemical Co | Pengxin International vs. Inner Mongolia BaoTou |
| Dongguan Chitwing vs. Agricultural Bank of | Dongguan Chitwing vs. Industrial and Commercial | Dongguan Chitwing vs. Bank of China | Dongguan Chitwing vs. PetroChina Co Ltd |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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