Correlation Between Huaibei Mining and China Satellite
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By analyzing existing cross correlation between Huaibei Mining Holdings and China Satellite Communications, you can compare the effects of market volatilities on Huaibei Mining and China Satellite 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 China Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huaibei Mining and China Satellite.
Diversification Opportunities for Huaibei Mining and China Satellite
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Huaibei and China is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Huaibei Mining Holdings and China Satellite Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Satellite Comm 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 China Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Satellite Comm has no effect on the direction of Huaibei Mining i.e., Huaibei Mining and China Satellite go up and down completely randomly.
Pair Corralation between Huaibei Mining and China Satellite
Assuming the 90 days trading horizon Huaibei Mining Holdings is expected to under-perform the China Satellite. But the stock apears to be less risky and, when comparing its historical volatility, Huaibei Mining Holdings is 2.52 times less risky than China Satellite. The stock trades about -0.13 of its potential returns per unit of risk. The China Satellite Communications is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,017 in China Satellite Communications on September 27, 2024 and sell it today you would earn a total of 103.00 from holding China Satellite Communications or generate 5.11% 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. China Satellite Communications
Performance |
| Timeline |
| Huaibei Mining Holdings |
| China Satellite Comm |
Huaibei Mining and China Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huaibei Mining and China Satellite
The main advantage of trading using opposite Huaibei Mining and China Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huaibei Mining position performs unexpectedly, China Satellite 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 China Satellite will offset losses from the drop in China Satellite's long position.| Huaibei Mining vs. Zijin Mining Group | Huaibei Mining vs. Baoshan Iron Steel | Huaibei Mining vs. Shandong Gold Mining | Huaibei Mining vs. Rongsheng Petrochemical Co |
| China Satellite vs. Chengdu Kanghua Biological | China Satellite vs. Beijing Wantai Biological | China Satellite vs. Suzhou Novoprotein Scientific | China Satellite vs. COL Digital Publishing |
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 Stocks Directory module to find actively traded stocks across global markets.
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