Correlation Between Dalian Thermal and Orient Sec
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By analyzing existing cross correlation between Dalian Thermal Power and Orient Sec Co, you can compare the effects of market volatilities on Dalian Thermal and Orient Sec 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 Dalian Thermal with a short position of Orient Sec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dalian Thermal and Orient Sec.
Diversification Opportunities for Dalian Thermal and Orient Sec
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dalian and Orient is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Dalian Thermal Power and Orient Sec Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orient Sec and Dalian Thermal 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 Dalian Thermal Power are associated (or correlated) with Orient Sec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orient Sec has no effect on the direction of Dalian Thermal i.e., Dalian Thermal and Orient Sec go up and down completely randomly.
Pair Corralation between Dalian Thermal and Orient Sec
Assuming the 90 days trading horizon Dalian Thermal Power is expected to generate 1.37 times more return on investment than Orient Sec. However, Dalian Thermal is 1.37 times more volatile than Orient Sec Co. It trades about 0.11 of its potential returns per unit of risk. Orient Sec Co is currently generating about 0.1 per unit of risk. If you would invest 617.00 in Dalian Thermal Power on September 24, 2024 and sell it today you would earn a total of 152.00 from holding Dalian Thermal Power or generate 24.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Dalian Thermal Power vs. Orient Sec Co
Performance |
Timeline |
Dalian Thermal Power |
Orient Sec |
Dalian Thermal and Orient Sec Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dalian Thermal and Orient Sec
The main advantage of trading using opposite Dalian Thermal and Orient Sec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dalian Thermal position performs unexpectedly, Orient Sec 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 Orient Sec will offset losses from the drop in Orient Sec's long position.Dalian Thermal vs. PetroChina Co Ltd | Dalian Thermal vs. China Mobile Limited | Dalian Thermal vs. CNOOC Limited | Dalian Thermal vs. Ping An Insurance |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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