Correlation Between Chengtun Mining and Muyuan Foodstuff
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By analyzing existing cross correlation between Chengtun Mining Group and Muyuan Foodstuff Co, you can compare the effects of market volatilities on Chengtun Mining and Muyuan Foodstuff 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 Muyuan Foodstuff. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengtun Mining and Muyuan Foodstuff.
Diversification Opportunities for Chengtun Mining and Muyuan Foodstuff
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chengtun and Muyuan is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Chengtun Mining Group and Muyuan Foodstuff Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Muyuan Foodstuff 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 Muyuan Foodstuff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Muyuan Foodstuff has no effect on the direction of Chengtun Mining i.e., Chengtun Mining and Muyuan Foodstuff go up and down completely randomly.
Pair Corralation between Chengtun Mining and Muyuan Foodstuff
Assuming the 90 days trading horizon Chengtun Mining Group is expected to generate 0.97 times more return on investment than Muyuan Foodstuff. However, Chengtun Mining Group is 1.03 times less risky than Muyuan Foodstuff. It trades about 0.24 of its potential returns per unit of risk. Muyuan Foodstuff Co is currently generating about 0.07 per unit of risk. If you would invest 354.00 in Chengtun Mining Group on September 12, 2024 and sell it today you would earn a total of 140.00 from holding Chengtun Mining Group or generate 39.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengtun Mining Group vs. Muyuan Foodstuff Co
Performance |
| Timeline |
| Chengtun Mining Group |
| Muyuan Foodstuff |
Chengtun Mining and Muyuan Foodstuff Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengtun Mining and Muyuan Foodstuff
The main advantage of trading using opposite Chengtun Mining and Muyuan Foodstuff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengtun Mining position performs unexpectedly, Muyuan Foodstuff 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 Muyuan Foodstuff will offset losses from the drop in Muyuan Foodstuff's 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 |
| Muyuan Foodstuff vs. Nanjing Putian Telecommunications | Muyuan Foodstuff vs. Tianjin Realty Development | Muyuan Foodstuff vs. Kangyue Technology Co | Muyuan Foodstuff vs. Shenzhen Hifuture Electric |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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