Correlation Between Hunan Nanling and Huaibei Mining
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By analyzing existing cross correlation between Hunan Nanling Industrial and Huaibei Mining Holdings, you can compare the effects of market volatilities on Hunan Nanling and Huaibei 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 Hunan Nanling with a short position of Huaibei Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunan Nanling and Huaibei Mining.
Diversification Opportunities for Hunan Nanling and Huaibei Mining
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hunan and Huaibei is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Hunan Nanling Industrial and Huaibei Mining Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huaibei Mining Holdings and Hunan Nanling 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 Hunan Nanling Industrial are associated (or correlated) with Huaibei Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huaibei Mining Holdings has no effect on the direction of Hunan Nanling i.e., Hunan Nanling and Huaibei Mining go up and down completely randomly.
Pair Corralation between Hunan Nanling and Huaibei Mining
Assuming the 90 days trading horizon Hunan Nanling Industrial is expected to generate 1.08 times more return on investment than Huaibei Mining. However, Hunan Nanling is 1.08 times more volatile than Huaibei Mining Holdings. It trades about 0.02 of its potential returns per unit of risk. Huaibei Mining Holdings is currently generating about -0.1 per unit of risk. If you would invest 1,214 in Hunan Nanling Industrial on August 28, 2024 and sell it today you would earn a total of 12.00 from holding Hunan Nanling Industrial or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hunan Nanling Industrial vs. Huaibei Mining Holdings
Performance |
| Timeline |
| Hunan Nanling Industrial |
| Huaibei Mining Holdings |
Hunan Nanling and Huaibei Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunan Nanling and Huaibei Mining
The main advantage of trading using opposite Hunan Nanling and Huaibei Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunan Nanling position performs unexpectedly, Huaibei 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 Huaibei Mining will offset losses from the drop in Huaibei Mining's long position.| Hunan Nanling vs. Bomin Electronics Co | Hunan Nanling vs. Aurora Optoelectronics Co | Hunan Nanling vs. TongFu Microelectronics Co | Hunan Nanling vs. Wuhan Yangtze Communication |
| Huaibei Mining vs. Minmetals Capital Co | Huaibei Mining vs. Jinhe Biotechnology Co | Huaibei Mining vs. Shanghai Yanpu Metal | Huaibei Mining vs. Shandong Mining Machinery |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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