Correlation Between China Construction and Guocheng Mining
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By analyzing existing cross correlation between China Construction Bank and Guocheng Mining Co, you can compare the effects of market volatilities on China Construction and Guocheng 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 China Construction with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Construction and Guocheng Mining.
Diversification Opportunities for China Construction and Guocheng Mining
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Guocheng is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding China Construction Bank and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and China Construction 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 China Construction Bank are associated (or correlated) with Guocheng Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guocheng Mining has no effect on the direction of China Construction i.e., China Construction and Guocheng Mining go up and down completely randomly.
Pair Corralation between China Construction and Guocheng Mining
Assuming the 90 days trading horizon China Construction is expected to generate 1.8 times less return on investment than Guocheng Mining. But when comparing it to its historical volatility, China Construction Bank is 2.41 times less risky than Guocheng Mining. It trades about 0.07 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,028 in Guocheng Mining Co on August 26, 2024 and sell it today you would earn a total of 335.00 from holding Guocheng Mining Co or generate 32.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Construction Bank vs. Guocheng Mining Co
Performance |
| Timeline |
| China Construction Bank |
| Guocheng Mining |
China Construction and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Construction and Guocheng Mining
The main advantage of trading using opposite China Construction and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Construction position performs unexpectedly, Guocheng 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 Guocheng Mining will offset losses from the drop in Guocheng Mining's long position.| China Construction vs. Longjian Road Bridge | China Construction vs. Dazhong Transportation Group | China Construction vs. Silkroad Visual Technology | China Construction vs. Road Environment Technology |
| Guocheng Mining vs. Industrial and Commercial | Guocheng Mining vs. Agricultural Bank of | Guocheng Mining vs. China Construction Bank | Guocheng Mining vs. Bank of China |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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