Correlation Between Hainan Mining and Sinomach General
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By analyzing existing cross correlation between Hainan Mining Co and Sinomach General Machinery, you can compare the effects of market volatilities on Hainan Mining and Sinomach General 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 Sinomach General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Mining and Sinomach General.
Diversification Opportunities for Hainan Mining and Sinomach General
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hainan and Sinomach is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Mining Co and Sinomach General Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach General Mac 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 Sinomach General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach General Mac has no effect on the direction of Hainan Mining i.e., Hainan Mining and Sinomach General go up and down completely randomly.
Pair Corralation between Hainan Mining and Sinomach General
Assuming the 90 days trading horizon Hainan Mining Co is expected to under-perform the Sinomach General. But the stock apears to be less risky and, when comparing its historical volatility, Hainan Mining Co is 1.26 times less risky than Sinomach General. The stock trades about -0.02 of its potential returns per unit of risk. The Sinomach General Machinery is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,495 in Sinomach General Machinery on November 3, 2024 and sell it today you would earn a total of 16.00 from holding Sinomach General Machinery or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hainan Mining Co vs. Sinomach General Machinery
Performance |
| Timeline |
| Hainan Mining |
| Sinomach General Mac |
Hainan Mining and Sinomach General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Mining and Sinomach General
The main advantage of trading using opposite Hainan Mining and Sinomach General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Mining position performs unexpectedly, Sinomach General 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 Sinomach General will offset losses from the drop in Sinomach General's long position.| Hainan Mining vs. Hangzhou Gisway Information | Hainan Mining vs. GRG Banking Equipment | Hainan Mining vs. Unisplendour Corp | Hainan Mining vs. Postal Savings Bank |
| Sinomach General vs. Biwin Storage Technology | Sinomach General vs. Jinxiandai Information Industry | Sinomach General vs. Invengo Information Technology | Sinomach General vs. Zhongfu 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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