Correlation Between Hainan Mining and China World
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By analyzing existing cross correlation between Hainan Mining Co and China World Trade, you can compare the effects of market volatilities on Hainan Mining and China World 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 China World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Mining and China World.
Diversification Opportunities for Hainan Mining and China World
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hainan and China is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Mining Co and China World Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China World Trade 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 China World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China World Trade has no effect on the direction of Hainan Mining i.e., Hainan Mining and China World go up and down completely randomly.
Pair Corralation between Hainan Mining and China World
Assuming the 90 days trading horizon Hainan Mining Co is expected to generate 1.59 times more return on investment than China World. However, Hainan Mining is 1.59 times more volatile than China World Trade. It trades about -0.08 of its potential returns per unit of risk. China World Trade is currently generating about -0.19 per unit of risk. If you would invest 715.00 in Hainan Mining Co on August 29, 2024 and sell it today you would lose (30.00) from holding Hainan Mining Co or give up 4.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Mining Co vs. China World Trade
Performance |
| Timeline |
| Hainan Mining |
| China World Trade |
Hainan Mining and China World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Mining and China World
The main advantage of trading using opposite Hainan Mining and China World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Mining position performs unexpectedly, China World 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 World will offset losses from the drop in China World'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 |
| China World vs. Industrial and Commercial | China World vs. China Construction Bank | China World vs. Bank of China | China World vs. Agricultural Bank of |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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