Correlation Between Chengdu Kanghua and Hainan Mining
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By analyzing existing cross correlation between Chengdu Kanghua Biological and Hainan Mining Co, you can compare the effects of market volatilities on Chengdu Kanghua and Hainan 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 Chengdu Kanghua with a short position of Hainan Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and Hainan Mining.
Diversification Opportunities for Chengdu Kanghua and Hainan Mining
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengdu and Hainan is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and Hainan Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Mining and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with Hainan Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hainan Mining has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and Hainan Mining go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and Hainan Mining
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to under-perform the Hainan Mining. In addition to that, Chengdu Kanghua is 1.35 times more volatile than Hainan Mining Co. It trades about 0.0 of its total potential returns per unit of risk. Hainan Mining Co is currently generating about 0.02 per unit of volatility. If you would invest 662.00 in Hainan Mining Co on August 31, 2024 and sell it today you would earn a total of 41.00 from holding Hainan Mining Co or generate 6.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. Hainan Mining Co
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| Hainan Mining |
Chengdu Kanghua and Hainan Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and Hainan Mining
The main advantage of trading using opposite Chengdu Kanghua and Hainan Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, Hainan 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 Hainan Mining will offset losses from the drop in Hainan Mining's long position.| Chengdu Kanghua vs. Hainan Mining Co | Chengdu Kanghua vs. Shandong Mining Machinery | Chengdu Kanghua vs. JCHX Mining Management | Chengdu Kanghua vs. Tibet Huayu Mining |
| Hainan Mining vs. Tianjin Hi Tech Development | Hainan Mining vs. Shandong Hongchuang Aluminum | Hainan Mining vs. Tianshan Aluminum Group | Hainan Mining vs. Beijing Yanjing 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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