Correlation Between Changchun and Guocheng Mining
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By analyzing existing cross correlation between Changchun UP Optotech and Guocheng Mining Co, you can compare the effects of market volatilities on Changchun 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 Changchun with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun and Guocheng Mining.
Diversification Opportunities for Changchun and Guocheng Mining
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Changchun and Guocheng is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Changchun UP Optotech and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and Changchun 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 Changchun UP Optotech 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 Changchun i.e., Changchun and Guocheng Mining go up and down completely randomly.
Pair Corralation between Changchun and Guocheng Mining
Assuming the 90 days trading horizon Changchun UP Optotech is expected to generate 0.81 times more return on investment than Guocheng Mining. However, Changchun UP Optotech is 1.24 times less risky than Guocheng Mining. It trades about 0.01 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about -0.36 per unit of risk. If you would invest 3,891 in Changchun UP Optotech on October 18, 2024 and sell it today you would earn a total of 2.00 from holding Changchun UP Optotech or generate 0.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun UP Optotech vs. Guocheng Mining Co
Performance |
| Timeline |
| Changchun UP Optotech |
| Guocheng Mining |
Changchun and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun and Guocheng Mining
The main advantage of trading using opposite Changchun and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun 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.| Changchun vs. Tieling Newcity Investment | Changchun vs. Hubei Geoway Investment | Changchun vs. GUOMAI Culture Media | Changchun vs. Vanfund Urban Investment |
| Guocheng Mining vs. Luyin Investment Group | Guocheng Mining vs. Fiberhome Telecommunication Technologies | Guocheng Mining vs. Beijing Bewinner Communications | Guocheng Mining vs. Jiangsu Yanghe Brewery |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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