Correlation Between Zhejiang Yongjin and Dalian Thermal
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By analyzing existing cross correlation between Zhejiang Yongjin Metal and Dalian Thermal Power, you can compare the effects of market volatilities on Zhejiang Yongjin and Dalian 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 Zhejiang Yongjin with a short position of Dalian Thermal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Yongjin and Dalian Thermal.
Diversification Opportunities for Zhejiang Yongjin and Dalian Thermal
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Zhejiang and Dalian is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Yongjin Metal and Dalian Thermal Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dalian Thermal Power and Zhejiang Yongjin 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 Zhejiang Yongjin Metal are associated (or correlated) with Dalian Thermal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dalian Thermal Power has no effect on the direction of Zhejiang Yongjin i.e., Zhejiang Yongjin and Dalian Thermal go up and down completely randomly.
Pair Corralation between Zhejiang Yongjin and Dalian Thermal
Assuming the 90 days trading horizon Zhejiang Yongjin Metal is expected to generate 0.53 times more return on investment than Dalian Thermal. However, Zhejiang Yongjin Metal is 1.88 times less risky than Dalian Thermal. It trades about 0.06 of its potential returns per unit of risk. Dalian Thermal Power is currently generating about -0.01 per unit of risk. If you would invest 1,749 in Zhejiang Yongjin Metal on November 3, 2024 and sell it today you would earn a total of 266.00 from holding Zhejiang Yongjin Metal or generate 15.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Yongjin Metal vs. Dalian Thermal Power
Performance |
| Timeline |
| Zhejiang Yongjin Metal |
| Dalian Thermal Power |
Zhejiang Yongjin and Dalian Thermal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Yongjin and Dalian Thermal
The main advantage of trading using opposite Zhejiang Yongjin and Dalian Thermal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Yongjin position performs unexpectedly, Dalian 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 Dalian Thermal will offset losses from the drop in Dalian Thermal's long position.| Zhejiang Yongjin vs. Zijin Mining Group | Zhejiang Yongjin vs. Wanhua Chemical Group | Zhejiang Yongjin vs. Baoshan Iron Steel | Zhejiang Yongjin vs. Shandong Gold Mining |
| Dalian Thermal vs. Zhejiang Publishing Media | Dalian Thermal vs. Time Publishing and | Dalian Thermal vs. Heilongjiang Publishing Media | Dalian Thermal vs. CSSC Offshore Marine |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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