Correlation Between China Minmetals and Fujian Longzhou
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By analyzing existing cross correlation between China Minmetals Rare and Fujian Longzhou Transportation, you can compare the effects of market volatilities on China Minmetals and Fujian Longzhou 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 Fujian Longzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Minmetals and Fujian Longzhou.
Diversification Opportunities for China Minmetals and Fujian Longzhou
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and Fujian is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding China Minmetals Rare and Fujian Longzhou Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Longzhou Tran 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 Fujian Longzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Longzhou Tran has no effect on the direction of China Minmetals i.e., China Minmetals and Fujian Longzhou go up and down completely randomly.
Pair Corralation between China Minmetals and Fujian Longzhou
Assuming the 90 days trading horizon China Minmetals Rare is expected to generate 0.69 times more return on investment than Fujian Longzhou. However, China Minmetals Rare is 1.46 times less risky than Fujian Longzhou. It trades about 0.07 of its potential returns per unit of risk. Fujian Longzhou Transportation is currently generating about 0.05 per unit of risk. If you would invest 2,703 in China Minmetals Rare on November 4, 2024 and sell it today you would earn a total of 56.00 from holding China Minmetals Rare or generate 2.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Minmetals Rare vs. Fujian Longzhou Transportation
Performance |
| Timeline |
| China Minmetals Rare |
| Fujian Longzhou Tran |
China Minmetals and Fujian Longzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Minmetals and Fujian Longzhou
The main advantage of trading using opposite China Minmetals and Fujian Longzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Minmetals position performs unexpectedly, Fujian Longzhou 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 Fujian Longzhou will offset losses from the drop in Fujian Longzhou's long position.| China Minmetals vs. Postal Savings Bank | China Minmetals vs. Jiangsu Financial Leasing | China Minmetals vs. JCHX Mining Management | China Minmetals vs. China Everbright Bank |
| Fujian Longzhou vs. Shengda Mining Co | Fujian Longzhou vs. Anhui Tongguan Copper | Fujian Longzhou vs. Shanghai CEO Environmental | Fujian Longzhou vs. China Asset Management |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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