Correlation Between China Vanke and Guocheng Mining
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By analyzing existing cross correlation between China Vanke Co and Guocheng Mining Co, you can compare the effects of market volatilities on China Vanke and Guocheng 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 China Vanke with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Vanke and Guocheng Mining.
Diversification Opportunities for China Vanke and Guocheng Mining
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between China and Guocheng is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding China Vanke Co and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and China Vanke 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 Vanke Co are associated (or correlated) with Guocheng Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guocheng Mining has no effect on the direction of China Vanke i.e., China Vanke and Guocheng Mining go up and down completely randomly.
Pair Corralation between China Vanke and Guocheng Mining
Assuming the 90 days trading horizon China Vanke Co is expected to generate 0.44 times more return on investment than Guocheng Mining. However, China Vanke Co is 2.27 times less risky than Guocheng Mining. It trades about -0.55 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about -0.42 per unit of risk. If you would invest 823.00 in China Vanke Co on October 17, 2024 and sell it today you would lose (137.00) from holding China Vanke Co or give up 16.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Vanke Co vs. Guocheng Mining Co
Performance |
| Timeline |
| China Vanke |
| Guocheng Mining |
China Vanke and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Vanke and Guocheng Mining
The main advantage of trading using opposite China Vanke and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Vanke position performs unexpectedly, Guocheng 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 Guocheng Mining will offset losses from the drop in Guocheng Mining's long position.| China Vanke vs. Qingdao Foods Co | China Vanke vs. Guangdong Wens Foodstuff | China Vanke vs. HaiXin Foods Co | China Vanke vs. China Building Material |
| Guocheng Mining vs. Luyin Investment Group | Guocheng Mining vs. Fiberhome Telecommunication Technologies | Guocheng Mining vs. Beijing Bewinner Communications | Guocheng Mining vs. Jiangsu Yanghe Brewery |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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