Correlation Between Guocheng Mining and Hubei Forbon
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By analyzing existing cross correlation between Guocheng Mining Co and Hubei Forbon Technology, you can compare the effects of market volatilities on Guocheng Mining and Hubei Forbon 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 Hubei Forbon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Hubei Forbon.
Diversification Opportunities for Guocheng Mining and Hubei Forbon
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guocheng and Hubei is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Hubei Forbon Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Forbon Technology 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 Hubei Forbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Forbon Technology has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Hubei Forbon go up and down completely randomly.
Pair Corralation between Guocheng Mining and Hubei Forbon
Assuming the 90 days trading horizon Guocheng Mining Co is expected to under-perform the Hubei Forbon. But the stock apears to be less risky and, when comparing its historical volatility, Guocheng Mining Co is 1.03 times less risky than Hubei Forbon. The stock trades about -0.02 of its potential returns per unit of risk. The Hubei Forbon Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 749.00 in Hubei Forbon Technology on October 31, 2024 and sell it today you would earn a total of 81.00 from holding Hubei Forbon Technology or generate 10.81% 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. Hubei Forbon Technology
Performance |
| Timeline |
| Guocheng Mining |
| Hubei Forbon Technology |
Guocheng Mining and Hubei Forbon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Hubei Forbon
The main advantage of trading using opposite Guocheng Mining and Hubei Forbon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Hubei Forbon 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 Hubei Forbon will offset losses from the drop in Hubei Forbon's long position.| Guocheng Mining vs. Guangdong Ellington Electronics | Guocheng Mining vs. Jilin Jlu Communication | Guocheng Mining vs. Nanjing Putian Telecommunications | Guocheng Mining vs. Jiangxi Hengda Hi Tech |
| Hubei Forbon vs. Zoje Resources Investment | Hubei Forbon vs. Shenzhen Bioeasy Biotechnology | Hubei Forbon vs. Chengdu Xingrong Investment | Hubei Forbon vs. Hubei Geoway Investment |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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