Correlation Between Chesapeake Utilities and Ming Le

Can any of the company-specific risk be diversified away by investing in both Chesapeake Utilities and Ming Le 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 Chesapeake Utilities and Ming Le into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chesapeake Utilities and Ming Le Sports, you can compare the effects of market volatilities on Chesapeake Utilities and Ming Le 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 Chesapeake Utilities with a short position of Ming Le. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chesapeake Utilities and Ming Le.

Diversification Opportunities for Chesapeake Utilities and Ming Le

-0.08

Correlation Coefficient

Chesapeake Utilities  Ming Le

Good diversification

The 3 months correlation between Chesapeake and Ming is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Chesapeake Utilities and Ming Le Sports in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ming Le Sports and Chesapeake Utilities 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 Chesapeake Utilities are associated (or correlated) with Ming Le. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ming Le Sports has no effect on the direction of Chesapeake Utilities i.e., Chesapeake Utilities and Ming Le go up and down completely randomly.

Pair Corralation between Chesapeake Utilities and Ming Le

Assuming the 90 days horizon Chesapeake Utilities is expected to under-perform the Ming Le. But the stock apears to be less risky and, when comparing its historical volatility, Chesapeake Utilities is 2.18 times less risky than Ming Le. The stock trades about -0.09 of its potential returns per unit of risk. The Ming Le Sports is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  104.00  in Ming Le Sports on April 24, 2025 and sell it today you would earn a total of  0.00  from holding Ming Le Sports or generate 0.0% return on investment over 90 days.

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

Chesapeake Utilities  vs.  Ming Le Sports

Chesapeake Utilities

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chesapeake Utilities has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Ming Le Sports

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ming Le Sports are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Ming Le is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Chesapeake Utilities and Ming Le

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

The idea behind Chesapeake Utilities and Ming Le Sports 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.