Correlation Between Guocheng Mining and Eastroc Beverage
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By analyzing existing cross correlation between Guocheng Mining Co and Eastroc Beverage Group, you can compare the effects of market volatilities on Guocheng Mining and Eastroc Beverage 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 Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Eastroc Beverage.
Diversification Opportunities for Guocheng Mining and Eastroc Beverage
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guocheng and Eastroc is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage 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 Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Guocheng Mining and Eastroc Beverage
Assuming the 90 days trading horizon Guocheng Mining Co is expected to generate 1.86 times more return on investment than Eastroc Beverage. However, Guocheng Mining is 1.86 times more volatile than Eastroc Beverage Group. It trades about 0.27 of its potential returns per unit of risk. Eastroc Beverage Group is currently generating about 0.22 per unit of risk. If you would invest 1,223 in Guocheng Mining Co on September 12, 2024 and sell it today you would earn a total of 307.00 from holding Guocheng Mining Co or generate 25.1% 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. Eastroc Beverage Group
Performance |
| Timeline |
| Guocheng Mining |
| Eastroc Beverage |
Guocheng Mining and Eastroc Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guocheng Mining and Eastroc Beverage
The main advantage of trading using opposite Guocheng Mining and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.| Guocheng Mining vs. Agricultural Bank of | Guocheng Mining vs. Industrial and Commercial | Guocheng Mining vs. Bank of China | Guocheng Mining vs. PetroChina Co Ltd |
| Eastroc Beverage vs. China Petroleum Chemical | Eastroc Beverage vs. PetroChina Co Ltd | Eastroc Beverage vs. China State Construction | Eastroc Beverage vs. China Railway 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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