Correlation Between China Mengniu and PACIFICORP
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By analyzing existing cross correlation between China Mengniu Dairy and PACIFICORP 625 percent, you can compare the effects of market volatilities on China Mengniu and PACIFICORP 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 Mengniu with a short position of PACIFICORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Mengniu and PACIFICORP.
Diversification Opportunities for China Mengniu and PACIFICORP
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and PACIFICORP is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding China Mengniu Dairy and PACIFICORP 625 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PACIFICORP 625 percent and China Mengniu 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 Mengniu Dairy are associated (or correlated) with PACIFICORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PACIFICORP 625 percent has no effect on the direction of China Mengniu i.e., China Mengniu and PACIFICORP go up and down completely randomly.
Pair Corralation between China Mengniu and PACIFICORP
Assuming the 90 days horizon China Mengniu Dairy is expected to generate 2.94 times more return on investment than PACIFICORP. However, China Mengniu is 2.94 times more volatile than PACIFICORP 625 percent. It trades about 0.2 of its potential returns per unit of risk. PACIFICORP 625 percent is currently generating about 0.15 per unit of risk. If you would invest 2,001 in China Mengniu Dairy on November 29, 2024 and sell it today you would earn a total of 275.00 from holding China Mengniu Dairy or generate 13.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Mengniu Dairy vs. PACIFICORP 625 percent
Performance |
| Timeline |
| China Mengniu Dairy |
| PACIFICORP 625 percent |
China Mengniu and PACIFICORP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Mengniu and PACIFICORP
The main advantage of trading using opposite China Mengniu and PACIFICORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Mengniu position performs unexpectedly, PACIFICORP 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 PACIFICORP will offset losses from the drop in PACIFICORP's long position.| China Mengniu vs. Nestle SA ADR | China Mengniu vs. ConAgra Foods | China Mengniu vs. Hormel Foods | China Mengniu vs. Kraft Heinz Co |
| PACIFICORP vs. AEP TEX INC | PACIFICORP vs. EastGroup Properties | PACIFICORP vs. Tat Techno | PACIFICORP vs. Intevac |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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