Correlation Between Western Metal and Guocheng Mining
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By analyzing existing cross correlation between Western Metal Materials and Guocheng Mining Co, you can compare the effects of market volatilities on Western Metal and Guocheng 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 Western Metal with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Guocheng Mining.
Diversification Opportunities for Western Metal and Guocheng Mining
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Western and Guocheng is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and Western Metal 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 Western Metal Materials are associated (or correlated) with Guocheng Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guocheng Mining has no effect on the direction of Western Metal i.e., Western Metal and Guocheng Mining go up and down completely randomly.
Pair Corralation between Western Metal and Guocheng Mining
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 0.93 times more return on investment than Guocheng Mining. However, Western Metal Materials is 1.08 times less risky than Guocheng Mining. It trades about 0.02 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about -0.02 per unit of risk. If you would invest 1,645 in Western Metal Materials on October 14, 2024 and sell it today you would earn a total of 202.00 from holding Western Metal Materials or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Guocheng Mining Co
Performance |
| Timeline |
| Western Metal Materials |
| Guocheng Mining |
Western Metal and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Guocheng Mining
The main advantage of trading using opposite Western Metal and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Guocheng 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 Guocheng Mining will offset losses from the drop in Guocheng Mining's long position.| Western Metal vs. Jiangsu Phoenix Publishing | Western Metal vs. Northern United Publishing | Western Metal vs. Offcn Education Technology | Western Metal vs. Chinese Universe Publishing |
| Guocheng Mining vs. Jiangyin Jianghua Microelectronics | Guocheng Mining vs. Sihui Fuji Electronics | Guocheng Mining vs. Advanced Technology Materials | Guocheng Mining vs. Western Metal Materials |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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