Correlation Between Chengtun Mining and Tibet Huayu
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By analyzing existing cross correlation between Chengtun Mining Group and Tibet Huayu Mining, you can compare the effects of market volatilities on Chengtun Mining and Tibet Huayu 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 Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengtun Mining and Tibet Huayu.
Diversification Opportunities for Chengtun Mining and Tibet Huayu
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengtun and Tibet is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Chengtun Mining Group and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining 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 Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of Chengtun Mining i.e., Chengtun Mining and Tibet Huayu go up and down completely randomly.
Pair Corralation between Chengtun Mining and Tibet Huayu
Assuming the 90 days trading horizon Chengtun Mining Group is expected to under-perform the Tibet Huayu. But the stock apears to be less risky and, when comparing its historical volatility, Chengtun Mining Group is 2.06 times less risky than Tibet Huayu. The stock trades about -0.1 of its potential returns per unit of risk. The Tibet Huayu Mining is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,222 in Tibet Huayu Mining on August 25, 2024 and sell it today you would earn a total of 89.00 from holding Tibet Huayu Mining or generate 7.28% 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. Tibet Huayu Mining
Performance |
| Timeline |
| Chengtun Mining Group |
| Tibet Huayu Mining |
Chengtun Mining and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengtun Mining and Tibet Huayu
The main advantage of trading using opposite Chengtun Mining and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengtun Mining position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.| Chengtun Mining vs. Zijin Mining Group | Chengtun Mining vs. Wanhua Chemical Group | Chengtun Mining vs. Baoshan Iron Steel | Chengtun Mining vs. Shandong Gold Mining |
| Tibet Huayu vs. Hoshine Silicon Ind | Tibet Huayu vs. Nantong Jiangshan Agrochemical | Tibet Huayu vs. Suzhou Mingzhi Technology | Tibet Huayu vs. FSPG Hi Tech Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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