Correlation Between Huaibei Mining and Guangzhou Zhujiang
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By analyzing existing cross correlation between Huaibei Mining Holdings and Guangzhou Zhujiang Brewery, you can compare the effects of market volatilities on Huaibei Mining and Guangzhou Zhujiang 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 Huaibei Mining with a short position of Guangzhou Zhujiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huaibei Mining and Guangzhou Zhujiang.
Diversification Opportunities for Huaibei Mining and Guangzhou Zhujiang
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Huaibei and Guangzhou is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Huaibei Mining Holdings and Guangzhou Zhujiang Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Zhujiang and Huaibei Mining 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 Huaibei Mining Holdings are associated (or correlated) with Guangzhou Zhujiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Zhujiang has no effect on the direction of Huaibei Mining i.e., Huaibei Mining and Guangzhou Zhujiang go up and down completely randomly.
Pair Corralation between Huaibei Mining and Guangzhou Zhujiang
Assuming the 90 days trading horizon Huaibei Mining Holdings is expected to under-perform the Guangzhou Zhujiang. But the stock apears to be less risky and, when comparing its historical volatility, Huaibei Mining Holdings is 1.79 times less risky than Guangzhou Zhujiang. The stock trades about -0.14 of its potential returns per unit of risk. The Guangzhou Zhujiang Brewery is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 905.00 in Guangzhou Zhujiang Brewery on November 29, 2024 and sell it today you would earn a total of 40.00 from holding Guangzhou Zhujiang Brewery or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huaibei Mining Holdings vs. Guangzhou Zhujiang Brewery
Performance |
| Timeline |
| Huaibei Mining Holdings |
| Guangzhou Zhujiang |
Huaibei Mining and Guangzhou Zhujiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huaibei Mining and Guangzhou Zhujiang
The main advantage of trading using opposite Huaibei Mining and Guangzhou Zhujiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huaibei Mining position performs unexpectedly, Guangzhou Zhujiang 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 Guangzhou Zhujiang will offset losses from the drop in Guangzhou Zhujiang's long position.| Huaibei Mining vs. Zhejiang Publishing Media | Huaibei Mining vs. Dhc Software Co | Huaibei Mining vs. iSoftStone Information Technology | Huaibei Mining vs. Kuang Chi Technologies |
| Guangzhou Zhujiang vs. Jiangsu Yueda Investment | Guangzhou Zhujiang vs. iSoftStone Information Technology | Guangzhou Zhujiang vs. Jointo Energy Investment | Guangzhou Zhujiang vs. Tieling Newcity Investment |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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