Correlation Between Guocheng Mining and Zhengzhou Coal
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By analyzing existing cross correlation between Guocheng Mining Co and Zhengzhou Coal Mining, you can compare the effects of market volatilities on Guocheng Mining and Zhengzhou Coal 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 Zhengzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Zhengzhou Coal.
Diversification Opportunities for Guocheng Mining and Zhengzhou Coal
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Guocheng and Zhengzhou is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Zhengzhou Coal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengzhou Coal Mining 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 Zhengzhou Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengzhou Coal Mining has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Zhengzhou Coal go up and down completely randomly.
Pair Corralation between Guocheng Mining and Zhengzhou Coal
Assuming the 90 days trading horizon Guocheng Mining Co is expected to under-perform the Zhengzhou Coal. In addition to that, Guocheng Mining is 2.39 times more volatile than Zhengzhou Coal Mining. It trades about -0.42 of its total potential returns per unit of risk. Zhengzhou Coal Mining is currently generating about 0.02 per unit of volatility. If you would invest 1,300 in Zhengzhou Coal Mining on October 17, 2024 and sell it today you would earn a total of 7.00 from holding Zhengzhou Coal Mining or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guocheng Mining Co vs. Zhengzhou Coal Mining
Performance |
| Timeline |
| Guocheng Mining |
| Zhengzhou Coal Mining |
Guocheng Mining and Zhengzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Zhengzhou Coal
The main advantage of trading using opposite Guocheng Mining and Zhengzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Zhengzhou Coal 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 Zhengzhou Coal will offset losses from the drop in Zhengzhou Coal's long position.| Guocheng Mining vs. Luyin Investment Group | Guocheng Mining vs. Fiberhome Telecommunication Technologies | Guocheng Mining vs. Beijing Bewinner Communications | Guocheng Mining vs. Jiangsu Yanghe Brewery |
| Zhengzhou Coal vs. Miracll Chemicals Co | Zhengzhou Coal vs. Dymatic Chemicals | Zhengzhou Coal vs. Shenzhen Noposion Agrochemicals | Zhengzhou Coal vs. Yingde Greatchem Chemicals |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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