Correlation Between Guocheng Mining and Xiangcai
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By analyzing existing cross correlation between Guocheng Mining Co and Xiangcai Co, you can compare the effects of market volatilities on Guocheng Mining and Xiangcai 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 Xiangcai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Xiangcai.
Diversification Opportunities for Guocheng Mining and Xiangcai
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guocheng and Xiangcai is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Xiangcai Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiangcai 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 Xiangcai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiangcai has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Xiangcai go up and down completely randomly.
Pair Corralation between Guocheng Mining and Xiangcai
Assuming the 90 days trading horizon Guocheng Mining Co is expected to generate 1.64 times more return on investment than Xiangcai. However, Guocheng Mining is 1.64 times more volatile than Xiangcai Co. It trades about 0.2 of its potential returns per unit of risk. Xiangcai Co is currently generating about 0.09 per unit of risk. If you would invest 1,192 in Guocheng Mining Co on September 4, 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. Xiangcai Co
Performance |
| Timeline |
| Guocheng Mining |
| Xiangcai |
Guocheng Mining and Xiangcai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Xiangcai
The main advantage of trading using opposite Guocheng Mining and Xiangcai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Xiangcai 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 Xiangcai will offset losses from the drop in Xiangcai's long position.| Guocheng Mining vs. Xiangyang Automobile Bearing | Guocheng Mining vs. Xizi Clean Energy | Guocheng Mining vs. Elite Color Environmental | Guocheng Mining vs. Iat Automobile Technology |
| Xiangcai vs. Ningbo Thermal Power | Xiangcai vs. Guocheng Mining Co | Xiangcai vs. Zhejiang Yayi Metal | Xiangcai vs. Beijing HuaYuanYiTong Thermal |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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