Correlation Between Nuode Investment and Chengtun Mining

Can any of the company-specific risk be diversified away by investing in both Nuode Investment and Chengtun 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 Nuode Investment and Chengtun Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nuode Investment Co and Chengtun Mining Group, you can compare the effects of market volatilities on Nuode Investment and Chengtun 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 Nuode Investment with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuode Investment and Chengtun Mining.

Diversification Opportunities for Nuode Investment and Chengtun Mining

0.0

Correlation Coefficient

Nuode Investment  Chengtun Mining

Pay attention - limited upside

The 3 months correlation between Nuode and Chengtun is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nuode Investment Co and Chengtun Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengtun Mining Group and Nuode Investment 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 Nuode Investment Co are associated (or correlated) with Chengtun Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengtun Mining Group has no effect on the direction of Nuode Investment i.e., Nuode Investment and Chengtun Mining go up and down completely randomly.

Pair Corralation between Nuode Investment and Chengtun Mining

Assuming the 90 days trading horizon Nuode Investment is expected to generate 110.98 times less return on investment than Chengtun Mining. But when comparing it to its historical volatility, Nuode Investment Co is 1.05 times less risky than Chengtun Mining. It trades about 0.0 of its potential returns per unit of risk. Chengtun Mining Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  466.00  in Chengtun Mining Group on December 25, 2024 and sell it today you would earn a total of  136.00  from holding Chengtun Mining Group or generate 29.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Nuode Investment Co  vs.  Chengtun Mining Group

Nuode Investment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nuode Investment Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Nuode Investment is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Chengtun Mining Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Chengtun Mining Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Chengtun Mining sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nuode Investment and Chengtun Mining

The main advantage of trading using opposite Nuode Investment and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuode Investment position performs unexpectedly, Chengtun 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 Chengtun Mining will offset losses from the drop in Chengtun Mining's long position.

The idea behind Nuode Investment Co and Chengtun Mining Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.