Correlation Between Chengtun Mining and Qingdao Foods
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By analyzing existing cross correlation between Chengtun Mining Group and Qingdao Foods Co, you can compare the effects of market volatilities on Chengtun Mining and Qingdao Foods 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 Chengtun Mining with a short position of Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengtun Mining and Qingdao Foods.
Diversification Opportunities for Chengtun Mining and Qingdao Foods
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengtun and Qingdao is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Chengtun Mining Group and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods and Chengtun Mining 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 Chengtun Mining Group are associated (or correlated) with Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Chengtun Mining i.e., Chengtun Mining and Qingdao Foods go up and down completely randomly.
Pair Corralation between Chengtun Mining and Qingdao Foods
Assuming the 90 days trading horizon Chengtun Mining Group is expected to under-perform the Qingdao Foods. But the stock apears to be less risky and, when comparing its historical volatility, Chengtun Mining Group is 1.32 times less risky than Qingdao Foods. The stock trades about -0.04 of its potential returns per unit of risk. The Qingdao Foods Co is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,459 in Qingdao Foods Co on September 13, 2024 and sell it today you would earn a total of 136.00 from holding Qingdao Foods Co or generate 9.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengtun Mining Group vs. Qingdao Foods Co
Performance |
| Timeline |
| Chengtun Mining Group |
| Qingdao Foods |
Chengtun Mining and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengtun Mining and Qingdao Foods
The main advantage of trading using opposite Chengtun Mining and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengtun Mining position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Chengtun Mining vs. Bengang Steel Plates | Chengtun Mining vs. Shenzhen MYS Environmental | Chengtun Mining vs. Central Plains Environment | Chengtun Mining vs. Jiangsu Yanghe Brewery |
| Qingdao Foods vs. Zhejiang Xiantong RubberPlastic | Qingdao Foods vs. King Strong New Material | Qingdao Foods vs. Cangzhou Mingzhu Plastic | Qingdao Foods vs. Tonghua Grape Wine |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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