Correlation Between Dalian Thermal and Ningbo Thermal
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By analyzing existing cross correlation between Dalian Thermal Power and Ningbo Thermal Power, you can compare the effects of market volatilities on Dalian Thermal and Ningbo 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 Dalian Thermal with a short position of Ningbo Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dalian Thermal and Ningbo Thermal.
Diversification Opportunities for Dalian Thermal and Ningbo Thermal
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dalian and Ningbo is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Dalian Thermal Power and Ningbo Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Thermal Power 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 Ningbo Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Thermal Power has no effect on the direction of Dalian Thermal i.e., Dalian Thermal and Ningbo Thermal go up and down completely randomly.
Pair Corralation between Dalian Thermal and Ningbo Thermal
Assuming the 90 days trading horizon Dalian Thermal Power is expected to generate 1.29 times more return on investment than Ningbo Thermal. However, Dalian Thermal is 1.29 times more volatile than Ningbo Thermal Power. It trades about -0.14 of its potential returns per unit of risk. Ningbo Thermal Power is currently generating about -0.33 per unit of risk. If you would invest 721.00 in Dalian Thermal Power on October 22, 2024 and sell it today you would lose (65.00) from holding Dalian Thermal Power or give up 9.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Dalian Thermal Power vs. Ningbo Thermal Power
Performance |
| Timeline |
| Dalian Thermal Power |
| Ningbo Thermal Power |
Dalian Thermal and Ningbo Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dalian Thermal and Ningbo Thermal
The main advantage of trading using opposite Dalian Thermal and Ningbo Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dalian Thermal position performs unexpectedly, Ningbo 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 Ningbo Thermal will offset losses from the drop in Ningbo Thermal's long position.| Dalian Thermal vs. Sino Platinum Metals Co | Dalian Thermal vs. Zhejiang Yongjin Metal | Dalian Thermal vs. Western Metal Materials | Dalian Thermal vs. Rising Nonferrous Metals |
| Ningbo Thermal vs. Cicc Fund Management | Ningbo Thermal vs. Heilongjiang Transport Development | Ningbo Thermal vs. Shanghai Yanpu Metal | Ningbo Thermal vs. Xinjiang Sailing Information |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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