Correlation Between Guocheng Mining and Hunan Valin
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By analyzing existing cross correlation between Guocheng Mining Co and Hunan Valin Steel, you can compare the effects of market volatilities on Guocheng Mining and Hunan Valin 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 Guocheng Mining with a short position of Hunan Valin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Hunan Valin.
Diversification Opportunities for Guocheng Mining and Hunan Valin
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guocheng and Hunan is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Hunan Valin Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan Valin Steel and Guocheng Mining 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 Guocheng Mining Co are associated (or correlated) with Hunan Valin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan Valin Steel has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Hunan Valin go up and down completely randomly.
Pair Corralation between Guocheng Mining and Hunan Valin
Assuming the 90 days trading horizon Guocheng Mining Co is expected to generate 1.91 times more return on investment than Hunan Valin. However, Guocheng Mining is 1.91 times more volatile than Hunan Valin Steel. It trades about 0.19 of its potential returns per unit of risk. Hunan Valin Steel is currently generating about -0.01 per unit of risk. If you would invest 1,192 in Guocheng Mining Co on September 5, 2024 and sell it today you would earn a total of 197.00 from holding Guocheng Mining Co or generate 16.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guocheng Mining Co vs. Hunan Valin Steel
Performance |
| Timeline |
| Guocheng Mining |
| Hunan Valin Steel |
Guocheng Mining and Hunan Valin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Hunan Valin
The main advantage of trading using opposite Guocheng Mining and Hunan Valin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Hunan Valin 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 Hunan Valin will offset losses from the drop in Hunan Valin's long position.| Guocheng Mining vs. Kweichow Moutai Co | Guocheng Mining vs. Shenzhen Mindray Bio Medical | Guocheng Mining vs. Jiangsu Pacific Quartz | Guocheng Mining vs. G bits Network Technology |
| Hunan Valin vs. China World Trade | Hunan Valin vs. Guocheng Mining Co | Hunan Valin vs. Beijing HuaYuanYiTong Thermal | Hunan Valin vs. Chengtun Mining Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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