Correlation Between Guocheng Mining and Chengtun Mining
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By analyzing existing cross correlation between Guocheng Mining Co and Chengtun Mining Group, you can compare the effects of market volatilities on Guocheng Mining and Chengtun 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 Guocheng Mining with a short position of Chengtun Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Chengtun Mining.
Diversification Opportunities for Guocheng Mining and Chengtun Mining
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guocheng and Chengtun is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Chengtun Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengtun Mining Group 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 Chengtun Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengtun Mining Group has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Chengtun Mining go up and down completely randomly.
Pair Corralation between Guocheng Mining and Chengtun Mining
Assuming the 90 days trading horizon Guocheng Mining Co is expected to generate 1.71 times more return on investment than Chengtun Mining. However, Guocheng Mining is 1.71 times more volatile than Chengtun Mining Group. It trades about 0.16 of its potential returns per unit of risk. Chengtun Mining Group is currently generating about -0.16 per unit of risk. If you would invest 1,244 in Guocheng Mining Co on August 27, 2024 and sell it today you would earn a total of 151.00 from holding Guocheng Mining Co or generate 12.14% 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. Chengtun Mining Group
Performance |
| Timeline |
| Guocheng Mining |
| Chengtun Mining Group |
Guocheng Mining and Chengtun Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Chengtun Mining
The main advantage of trading using opposite Guocheng Mining and Chengtun Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Chengtun 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 Chengtun Mining will offset losses from the drop in Chengtun Mining's long position.| Guocheng Mining vs. Industrial and Commercial | Guocheng Mining vs. Agricultural Bank of | Guocheng Mining vs. China Construction Bank | Guocheng Mining vs. Bank of China |
| Chengtun Mining vs. Zijin Mining Group | Chengtun Mining vs. Wanhua Chemical Group | Chengtun Mining vs. Baoshan Iron Steel | Chengtun Mining vs. Shandong Gold Mining |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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