Correlation Between Dongxing Sec and China Molybdenum
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By analyzing existing cross correlation between Dongxing Sec Co and China Molybdenum Co, you can compare the effects of market volatilities on Dongxing Sec and China Molybdenum 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 Dongxing Sec with a short position of China Molybdenum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongxing Sec and China Molybdenum.
Diversification Opportunities for Dongxing Sec and China Molybdenum
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongxing and China is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Dongxing Sec Co and China Molybdenum Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Molybdenum and Dongxing Sec 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 Dongxing Sec Co are associated (or correlated) with China Molybdenum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Molybdenum has no effect on the direction of Dongxing Sec i.e., Dongxing Sec and China Molybdenum go up and down completely randomly.
Pair Corralation between Dongxing Sec and China Molybdenum
Assuming the 90 days trading horizon Dongxing Sec is expected to generate 1.27 times less return on investment than China Molybdenum. But when comparing it to its historical volatility, Dongxing Sec Co is 1.14 times less risky than China Molybdenum. It trades about 0.04 of its potential returns per unit of risk. China Molybdenum Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 493.00 in China Molybdenum Co on August 30, 2024 and sell it today you would earn a total of 237.00 from holding China Molybdenum Co or generate 48.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongxing Sec Co vs. China Molybdenum Co
Performance |
| Timeline |
| Dongxing Sec |
| China Molybdenum |
Dongxing Sec and China Molybdenum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongxing Sec and China Molybdenum
The main advantage of trading using opposite Dongxing Sec and China Molybdenum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongxing Sec position performs unexpectedly, China Molybdenum 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 Molybdenum will offset losses from the drop in China Molybdenum's long position.| Dongxing Sec vs. Kweichow Moutai Co | Dongxing Sec vs. Contemporary Amperex Technology | Dongxing Sec vs. G bits Network Technology | Dongxing Sec vs. BYD Co Ltd |
| China Molybdenum vs. Beijing Yanjing Brewery | China Molybdenum vs. CICC Fund Management | China Molybdenum vs. Eastroc Beverage Group | China Molybdenum vs. Shenzhen Kexin Communication |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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