Correlation Between China Power and Contango ORE
Can any of the company-specific risk be diversified away by investing in both China Power and Contango ORE 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 Power and Contango ORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Power Equipment and Contango ORE, you can compare the effects of market volatilities on China Power and Contango ORE 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 Power with a short position of Contango ORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Power and Contango ORE.
Diversification Opportunities for China Power and Contango ORE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Contango is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Power Equipment and Contango ORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Contango ORE and China Power 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 Power Equipment are associated (or correlated) with Contango ORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Contango ORE has no effect on the direction of China Power i.e., China Power and Contango ORE go up and down completely randomly.
Pair Corralation between China Power and Contango ORE
If you would invest 1,030 in Contango ORE on October 23, 2024 and sell it today you would earn a total of 130.00 from holding Contango ORE or generate 12.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
China Power Equipment vs. Contango ORE
Performance |
| Timeline |
| China Power Equipment |
| Contango ORE |
China Power and Contango ORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Power and Contango ORE
The main advantage of trading using opposite China Power and Contango ORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Power position performs unexpectedly, Contango ORE 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 Contango ORE will offset losses from the drop in Contango ORE's long position.| China Power vs. enVVeno Medical Corp | China Power vs. Asure Software | China Power vs. Joint Stock | China Power vs. NetSol Technologies |
| Contango ORE vs. First Guaranty Bancshares | Contango ORE vs. Glen Burnie Bancorp | Contango ORE vs. Princeton Capital |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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