Correlation Between China International and JCHX Mining
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By analyzing existing cross correlation between China International Capital and JCHX Mining Management, you can compare the effects of market volatilities on China International and JCHX 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 International with a short position of JCHX Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of China International and JCHX Mining.
Diversification Opportunities for China International and JCHX Mining
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and JCHX is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding China International Capital and JCHX Mining Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JCHX Mining Management and China International 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 International Capital are associated (or correlated) with JCHX Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JCHX Mining Management has no effect on the direction of China International i.e., China International and JCHX Mining go up and down completely randomly.
Pair Corralation between China International and JCHX Mining
Assuming the 90 days trading horizon China International Capital is expected to under-perform the JCHX Mining. In addition to that, China International is 1.05 times more volatile than JCHX Mining Management. It trades about -0.09 of its total potential returns per unit of risk. JCHX Mining Management is currently generating about -0.07 per unit of volatility. If you would invest 4,089 in JCHX Mining Management on August 28, 2024 and sell it today you would lose (194.00) from holding JCHX Mining Management or give up 4.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China International Capital vs. JCHX Mining Management
Performance |
| Timeline |
| China International |
| JCHX Mining Management |
China International and JCHX Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China International and JCHX Mining
The main advantage of trading using opposite China International and JCHX Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China International position performs unexpectedly, JCHX 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 JCHX Mining will offset losses from the drop in JCHX Mining's long position.The idea behind China International Capital and JCHX Mining Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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