Correlation Between China Minmetals and North Copper
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By analyzing existing cross correlation between China Minmetals Rare and North Copper Shanxi, you can compare the effects of market volatilities on China Minmetals and North Copper 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 China Minmetals with a short position of North Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Minmetals and North Copper.
Diversification Opportunities for China Minmetals and North Copper
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and North is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding China Minmetals Rare and North Copper Shanxi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Copper Shanxi and China Minmetals 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 China Minmetals Rare are associated (or correlated) with North Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Copper Shanxi has no effect on the direction of China Minmetals i.e., China Minmetals and North Copper go up and down completely randomly.
Pair Corralation between China Minmetals and North Copper
Assuming the 90 days trading horizon China Minmetals is expected to generate 10.88 times less return on investment than North Copper. But when comparing it to its historical volatility, China Minmetals Rare is 2.26 times less risky than North Copper. It trades about 0.05 of its potential returns per unit of risk. North Copper Shanxi is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 761.00 in North Copper Shanxi on November 2, 2024 and sell it today you would earn a total of 145.00 from holding North Copper Shanxi or generate 19.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Minmetals Rare vs. North Copper Shanxi
Performance |
| Timeline |
| China Minmetals Rare |
| North Copper Shanxi |
China Minmetals and North Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Minmetals and North Copper
The main advantage of trading using opposite China Minmetals and North Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Minmetals position performs unexpectedly, North Copper 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 North Copper will offset losses from the drop in North Copper's long position.| China Minmetals vs. Xiangyang Automobile Bearing | China Minmetals vs. Anhui Jianghuai Automobile | China Minmetals vs. Iat Automobile Technology | China Minmetals vs. JCHX Mining Management |
| North Copper vs. Bus Online Co | North Copper vs. Holitech Technology Co | North Copper vs. Gome Telecom Equipment | North Copper vs. Cultural Investment Holdings |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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