Correlation Between Xinjiang Baodi and Chengtun Mining
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By analyzing existing cross correlation between Xinjiang Baodi Mining and Chengtun Mining Group, you can compare the effects of market volatilities on Xinjiang Baodi 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 Xinjiang Baodi with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinjiang Baodi and Chengtun Mining.
Diversification Opportunities for Xinjiang Baodi and Chengtun Mining
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Xinjiang and Chengtun is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Xinjiang Baodi Mining 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 Xinjiang Baodi 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 Xinjiang Baodi Mining 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 Xinjiang Baodi i.e., Xinjiang Baodi and Chengtun Mining go up and down completely randomly.
Pair Corralation between Xinjiang Baodi and Chengtun Mining
Assuming the 90 days trading horizon Xinjiang Baodi Mining is expected to generate 1.26 times more return on investment than Chengtun Mining. However, Xinjiang Baodi is 1.26 times more volatile than Chengtun Mining Group. It trades about 0.08 of its potential returns per unit of risk. Chengtun Mining Group is currently generating about -0.16 per unit of risk. If you would invest 635.00 in Xinjiang Baodi Mining on August 29, 2024 and sell it today you would earn a total of 24.00 from holding Xinjiang Baodi Mining or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinjiang Baodi Mining vs. Chengtun Mining Group
Performance |
| Timeline |
| Xinjiang Baodi Mining |
| Chengtun Mining Group |
Xinjiang Baodi and Chengtun Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinjiang Baodi and Chengtun Mining
The main advantage of trading using opposite Xinjiang Baodi and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinjiang Baodi 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.| Xinjiang Baodi vs. Zijin Mining Group | Xinjiang Baodi vs. Wanhua Chemical Group | Xinjiang Baodi vs. Baoshan Iron Steel | Xinjiang Baodi vs. Shandong Gold Mining |
| 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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