Correlation Between China Natural and Chesapeake Utilities
Can any of the company-specific risk be diversified away by investing in both China Natural and Chesapeake Utilities at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining China Natural and Chesapeake Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Natural Cmn and Chesapeake Utilities, you can compare the effects of market volatilities on China Natural and Chesapeake Utilities 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 China Natural with a short position of Chesapeake Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Natural and Chesapeake Utilities.
Diversification Opportunities for China Natural and Chesapeake Utilities
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Chesapeake is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Natural Cmn and Chesapeake Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chesapeake Utilities and China Natural 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 China Natural Cmn are associated (or correlated) with Chesapeake Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chesapeake Utilities has no effect on the direction of China Natural i.e., China Natural and Chesapeake Utilities go up and down completely randomly.
Pair Corralation between China Natural and Chesapeake Utilities
If you would invest 12,400 in Chesapeake Utilities on November 8, 2024 and sell it today you would earn a total of 116.00 from holding Chesapeake Utilities or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
China Natural Cmn vs. Chesapeake Utilities
Performance |
| Timeline |
| China Natural Cmn |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Chesapeake Utilities |
China Natural and Chesapeake Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Natural and Chesapeake Utilities
The main advantage of trading using opposite China Natural and Chesapeake Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Natural position performs unexpectedly, Chesapeake Utilities 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 Chesapeake Utilities will offset losses from the drop in Chesapeake Utilities' long position.| China Natural vs. ENN Energy Holdings | China Natural vs. APA Group | China Natural vs. EverGen Infrastructure Corp | China Natural vs. Beijing Gas Blue |
| Chesapeake Utilities vs. Northwest Natural Gas | Chesapeake Utilities vs. One Gas | Chesapeake Utilities vs. NewJersey Resources | Chesapeake Utilities vs. Spire Inc |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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