Correlation Between Hubei Forbon and Western Mining
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By analyzing existing cross correlation between Hubei Forbon Technology and Western Mining Co, you can compare the effects of market volatilities on Hubei Forbon and Western 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 Hubei Forbon with a short position of Western Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Forbon and Western Mining.
Diversification Opportunities for Hubei Forbon and Western Mining
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hubei and Western is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Forbon Technology and Western Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Mining and Hubei Forbon 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 Hubei Forbon Technology are associated (or correlated) with Western Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Mining has no effect on the direction of Hubei Forbon i.e., Hubei Forbon and Western Mining go up and down completely randomly.
Pair Corralation between Hubei Forbon and Western Mining
Assuming the 90 days trading horizon Hubei Forbon is expected to generate 2.53 times less return on investment than Western Mining. In addition to that, Hubei Forbon is 1.28 times more volatile than Western Mining Co. It trades about 0.02 of its total potential returns per unit of risk. Western Mining Co is currently generating about 0.06 per unit of volatility. If you would invest 1,002 in Western Mining Co on November 2, 2024 and sell it today you would earn a total of 741.00 from holding Western Mining Co or generate 73.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Forbon Technology vs. Western Mining Co
Performance |
| Timeline |
| Hubei Forbon Technology |
| Western Mining |
Hubei Forbon and Western Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Forbon and Western Mining
The main advantage of trading using opposite Hubei Forbon and Western Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Forbon position performs unexpectedly, Western 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 Western Mining will offset losses from the drop in Western Mining's long position.| Hubei Forbon vs. Spring Airlines Co | Hubei Forbon vs. Xiandai Investment Co | Hubei Forbon vs. GRIPM Advanced Materials | Hubei Forbon vs. Beijing Mainstreets Investment |
| Western Mining vs. Zijin Mining Group | Western Mining vs. Wanhua Chemical Group | Western Mining vs. Baoshan Iron Steel | Western Mining vs. Shandong Gold Mining |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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