Correlation Between Dalian Thermal and Jiugui Liquor
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By analyzing existing cross correlation between Dalian Thermal Power and Jiugui Liquor Co, you can compare the effects of market volatilities on Dalian Thermal and Jiugui Liquor 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 Dalian Thermal with a short position of Jiugui Liquor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dalian Thermal and Jiugui Liquor.
Diversification Opportunities for Dalian Thermal and Jiugui Liquor
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dalian and Jiugui is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Dalian Thermal Power and Jiugui Liquor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiugui Liquor and Dalian Thermal 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 Dalian Thermal Power are associated (or correlated) with Jiugui Liquor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiugui Liquor has no effect on the direction of Dalian Thermal i.e., Dalian Thermal and Jiugui Liquor go up and down completely randomly.
Pair Corralation between Dalian Thermal and Jiugui Liquor
Assuming the 90 days trading horizon Dalian Thermal Power is expected to generate 1.3 times more return on investment than Jiugui Liquor. However, Dalian Thermal is 1.3 times more volatile than Jiugui Liquor Co. It trades about 0.06 of its potential returns per unit of risk. Jiugui Liquor Co is currently generating about 0.05 per unit of risk. If you would invest 732.00 in Dalian Thermal Power on September 3, 2024 and sell it today you would earn a total of 58.00 from holding Dalian Thermal Power or generate 7.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dalian Thermal Power vs. Jiugui Liquor Co
Performance |
| Timeline |
| Dalian Thermal Power |
| Jiugui Liquor |
Dalian Thermal and Jiugui Liquor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dalian Thermal and Jiugui Liquor
The main advantage of trading using opposite Dalian Thermal and Jiugui Liquor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dalian Thermal position performs unexpectedly, Jiugui Liquor 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 Jiugui Liquor will offset losses from the drop in Jiugui Liquor's long position.| Dalian Thermal vs. Industrial and Commercial | Dalian Thermal vs. Agricultural Bank of | Dalian Thermal vs. China Construction Bank | Dalian Thermal vs. Bank of China |
| Jiugui Liquor vs. Chongqing Brewery Co | Jiugui Liquor vs. JiShi Media Co | Jiugui Liquor vs. China Publishing Media | Jiugui Liquor vs. Zhejiang Daily Media |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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