Correlation Between Hainan Mining and Guocheng Mining
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By analyzing existing cross correlation between Hainan Mining Co and Guocheng Mining Co, you can compare the effects of market volatilities on Hainan Mining 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 Hainan Mining with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Mining and Guocheng Mining.
Diversification Opportunities for Hainan Mining and Guocheng Mining
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hainan and Guocheng is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Mining Co and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and Hainan 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 Hainan Mining Co 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 Hainan Mining i.e., Hainan Mining and Guocheng Mining go up and down completely randomly.
Pair Corralation between Hainan Mining and Guocheng Mining
Assuming the 90 days trading horizon Hainan Mining is expected to generate 11.2 times less return on investment than Guocheng Mining. But when comparing it to its historical volatility, Hainan Mining Co is 1.27 times less risky than Guocheng Mining. It trades about 0.0 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,284 in Guocheng Mining Co on August 29, 2024 and sell it today you would earn a total of 36.00 from holding Guocheng Mining Co or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Mining Co vs. Guocheng Mining Co
Performance |
| Timeline |
| Hainan Mining |
| Guocheng Mining |
Hainan Mining and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Mining and Guocheng Mining
The main advantage of trading using opposite Hainan Mining and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Mining 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.| Hainan Mining vs. Wanhua Chemical Group | Hainan Mining vs. Shandong Gold Mining | Hainan Mining vs. Rongsheng Petrochemical Co | Hainan Mining vs. Inner Mongolia BaoTou |
| Guocheng Mining vs. Citic Guoan Wine | Guocheng Mining vs. Hainan Mining Co | Guocheng Mining vs. Dawning Information Industry | Guocheng Mining vs. Zhuhai Comleader Information |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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