Correlation Between Chengdu PUTIAN and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both Chengdu PUTIAN and GRIFFIN MINING 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 Chengdu PUTIAN and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chengdu PUTIAN Telecommunications and GRIFFIN MINING LTD, you can compare the effects of market volatilities on Chengdu PUTIAN and GRIFFIN 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 Chengdu PUTIAN with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu PUTIAN and GRIFFIN MINING.
Diversification Opportunities for Chengdu PUTIAN and GRIFFIN MINING
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chengdu and GRIFFIN is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu PUTIAN Telecommunicati and GRIFFIN MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRIFFIN MINING LTD and Chengdu PUTIAN 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 Chengdu PUTIAN Telecommunications are associated (or correlated) with GRIFFIN MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRIFFIN MINING LTD has no effect on the direction of Chengdu PUTIAN i.e., Chengdu PUTIAN and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between Chengdu PUTIAN and GRIFFIN MINING
Assuming the 90 days trading horizon Chengdu PUTIAN Telecommunications is expected to generate 3.55 times more return on investment than GRIFFIN MINING. However, Chengdu PUTIAN is 3.55 times more volatile than GRIFFIN MINING LTD. It trades about 0.03 of its potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.07 per unit of risk. If you would invest 9.80 in Chengdu PUTIAN Telecommunications on November 1, 2024 and sell it today you would lose (2.00) from holding Chengdu PUTIAN Telecommunications or give up 20.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu PUTIAN Telecommunicati vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| Chengdu PUTIAN Telec |
| GRIFFIN MINING LTD |
Chengdu PUTIAN and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu PUTIAN and GRIFFIN MINING
The main advantage of trading using opposite Chengdu PUTIAN and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu PUTIAN position performs unexpectedly, GRIFFIN 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 GRIFFIN MINING will offset losses from the drop in GRIFFIN MINING's long position.| Chengdu PUTIAN vs. PRECISION DRILLING P | Chengdu PUTIAN vs. ATOSS SOFTWARE | Chengdu PUTIAN vs. UPDATE SOFTWARE | Chengdu PUTIAN vs. BORR DRILLING NEW |
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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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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