Correlation Between Fujian Oriental and Chengtun Mining
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By analyzing existing cross correlation between Fujian Oriental Silver and Chengtun Mining Group, you can compare the effects of market volatilities on Fujian Oriental and Chengtun Mining 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 Fujian Oriental with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Oriental and Chengtun Mining.
Diversification Opportunities for Fujian Oriental and Chengtun Mining
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fujian and Chengtun is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Oriental Silver and Chengtun Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengtun Mining Group and Fujian Oriental 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 Fujian Oriental Silver are associated (or correlated) with Chengtun Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengtun Mining Group has no effect on the direction of Fujian Oriental i.e., Fujian Oriental and Chengtun Mining go up and down completely randomly.
Pair Corralation between Fujian Oriental and Chengtun Mining
Assuming the 90 days trading horizon Fujian Oriental Silver is expected to under-perform the Chengtun Mining. In addition to that, Fujian Oriental is 1.6 times more volatile than Chengtun Mining Group. It trades about -0.26 of its total potential returns per unit of risk. Chengtun Mining Group is currently generating about -0.16 per unit of volatility. If you would invest 514.00 in Chengtun Mining Group on August 29, 2024 and sell it today you would lose (40.00) from holding Chengtun Mining Group or give up 7.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fujian Oriental Silver vs. Chengtun Mining Group
Performance |
| Timeline |
| Fujian Oriental Silver |
| Chengtun Mining Group |
Fujian Oriental and Chengtun Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Oriental and Chengtun Mining
The main advantage of trading using opposite Fujian Oriental and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Oriental position performs unexpectedly, Chengtun Mining 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 Chengtun Mining will offset losses from the drop in Chengtun Mining's long position.| Fujian Oriental vs. Industrial and Commercial | Fujian Oriental vs. Agricultural Bank of | Fujian Oriental vs. China Construction Bank | Fujian Oriental vs. Bank of China |
| Chengtun Mining vs. Tianshan Aluminum Group | Chengtun Mining vs. Dalian Zeus Entertainment | Chengtun Mining vs. Focus Media Information | Chengtun Mining vs. Lander Sports Development |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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