Correlation Between Chengtun Mining and Dalian Thermal
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By analyzing existing cross correlation between Chengtun Mining Group and Dalian Thermal Power, you can compare the effects of market volatilities on Chengtun Mining and Dalian Thermal 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 Dalian Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengtun Mining and Dalian Thermal.
Diversification Opportunities for Chengtun Mining and Dalian Thermal
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengtun and Dalian is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Chengtun Mining Group and Dalian Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalian Thermal Power 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 Dalian Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalian Thermal Power has no effect on the direction of Chengtun Mining i.e., Chengtun Mining and Dalian Thermal go up and down completely randomly.
Pair Corralation between Chengtun Mining and Dalian Thermal
Assuming the 90 days trading horizon Chengtun Mining Group is expected to under-perform the Dalian Thermal. But the stock apears to be less risky and, when comparing its historical volatility, Chengtun Mining Group is 1.92 times less risky than Dalian Thermal. The stock trades about -0.04 of its potential returns per unit of risk. The Dalian Thermal Power is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 827.00 in Dalian Thermal Power on September 13, 2024 and sell it today you would earn a total of 4.00 from holding Dalian Thermal Power or generate 0.48% 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. Dalian Thermal Power
Performance |
| Timeline |
| Chengtun Mining Group |
| Dalian Thermal Power |
Chengtun Mining and Dalian Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengtun Mining and Dalian Thermal
The main advantage of trading using opposite Chengtun Mining and Dalian Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengtun Mining position performs unexpectedly, Dalian Thermal 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 Dalian Thermal will offset losses from the drop in Dalian Thermal'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 |
| Dalian Thermal vs. Jinhe Biotechnology Co | Dalian Thermal vs. Jiujiang Shanshui Technology | Dalian Thermal vs. Northking Information Technology | Dalian Thermal vs. Jiangxi JDL Environmental |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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