Correlation Between Hainan Mining and Eastroc Beverage
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By analyzing existing cross correlation between Hainan Mining Co and Eastroc Beverage Group, you can compare the effects of market volatilities on Hainan Mining and Eastroc Beverage 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 Eastroc Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hainan Mining and Eastroc Beverage.
Diversification Opportunities for Hainan Mining and Eastroc Beverage
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hainan and Eastroc is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hainan Mining Co and Eastroc Beverage Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastroc Beverage 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 Eastroc Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastroc Beverage has no effect on the direction of Hainan Mining i.e., Hainan Mining and Eastroc Beverage go up and down completely randomly.
Pair Corralation between Hainan Mining and Eastroc Beverage
Assuming the 90 days trading horizon Hainan Mining is expected to generate 2.29 times less return on investment than Eastroc Beverage. In addition to that, Hainan Mining is 1.36 times more volatile than Eastroc Beverage Group. It trades about 0.07 of its total potential returns per unit of risk. Eastroc Beverage Group is currently generating about 0.22 per unit of volatility. If you would invest 21,920 in Eastroc Beverage Group on September 12, 2024 and sell it today you would earn a total of 2,330 from holding Eastroc Beverage Group or generate 10.63% 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. Eastroc Beverage Group
Performance |
| Timeline |
| Hainan Mining |
| Eastroc Beverage |
Hainan Mining and Eastroc Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hainan Mining and Eastroc Beverage
The main advantage of trading using opposite Hainan Mining and Eastroc Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hainan Mining position performs unexpectedly, Eastroc Beverage 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 Eastroc Beverage will offset losses from the drop in Eastroc Beverage's long position.| Hainan Mining vs. Zijin Mining Group | Hainan Mining vs. Wanhua Chemical Group | Hainan Mining vs. Baoshan Iron Steel | Hainan Mining vs. Rongsheng Petrochemical Co |
| Eastroc Beverage vs. China Petroleum Chemical | Eastroc Beverage vs. PetroChina Co Ltd | Eastroc Beverage vs. China State Construction | Eastroc Beverage vs. China Railway Group |
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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