Correlation Between Inner Mongolia and Hainan Mining
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By analyzing existing cross correlation between Inner Mongolia BaoTou and Hainan Mining Co, you can compare the effects of market volatilities on Inner Mongolia 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 Inner Mongolia with a short position of Hainan Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inner Mongolia and Hainan Mining.
Diversification Opportunities for Inner Mongolia and Hainan Mining
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Inner and Hainan is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Inner Mongolia BaoTou and Hainan Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hainan Mining and Inner Mongolia 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 Inner Mongolia BaoTou 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 Inner Mongolia i.e., Inner Mongolia and Hainan Mining go up and down completely randomly.
Pair Corralation between Inner Mongolia and Hainan Mining
Assuming the 90 days trading horizon Inner Mongolia BaoTou is expected to generate 2.04 times more return on investment than Hainan Mining. However, Inner Mongolia is 2.04 times more volatile than Hainan Mining Co. It trades about 0.17 of its potential returns per unit of risk. Hainan Mining Co is currently generating about 0.06 per unit of risk. If you would invest 168.00 in Inner Mongolia BaoTou on August 30, 2024 and sell it today you would earn a total of 25.00 from holding Inner Mongolia BaoTou or generate 14.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inner Mongolia BaoTou vs. Hainan Mining Co
Performance |
| Timeline |
| Inner Mongolia BaoTou |
| Hainan Mining |
Inner Mongolia and Hainan Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inner Mongolia and Hainan Mining
The main advantage of trading using opposite Inner Mongolia and Hainan Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inner Mongolia 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.| Inner Mongolia vs. Union Semiconductor Co | Inner Mongolia vs. Shuhua Sports Co | Inner Mongolia vs. Semiconductor Manufacturing Electronics | Inner Mongolia vs. Anhui Transport Consulting |
| Hainan Mining vs. Shanghai Xinhua Media | Hainan Mining vs. Guangzhou KingTeller Technology | Hainan Mining vs. Jiujiang Shanshui Technology | Hainan Mining vs. Sinofibers Technology Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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