Correlation Between HOCHSCHILD MINING and CHINA EAST
Can any of the company-specific risk be diversified away by investing in both HOCHSCHILD MINING and CHINA EAST at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining HOCHSCHILD MINING and CHINA EAST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HOCHSCHILD MINING and CHINA EAST ED, you can compare the effects of market volatilities on HOCHSCHILD MINING and CHINA EAST 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 HOCHSCHILD MINING with a short position of CHINA EAST. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOCHSCHILD MINING and CHINA EAST.
Diversification Opportunities for HOCHSCHILD MINING and CHINA EAST
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HOCHSCHILD and CHINA is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding HOCHSCHILD MINING and CHINA EAST ED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA EAST ED and HOCHSCHILD 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 HOCHSCHILD MINING are associated (or correlated) with CHINA EAST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA EAST ED has no effect on the direction of HOCHSCHILD MINING i.e., HOCHSCHILD MINING and CHINA EAST go up and down completely randomly.
Pair Corralation between HOCHSCHILD MINING and CHINA EAST
Assuming the 90 days trading horizon HOCHSCHILD MINING is expected to under-perform the CHINA EAST. In addition to that, HOCHSCHILD MINING is 1.92 times more volatile than CHINA EAST ED. It trades about -0.1 of its total potential returns per unit of risk. CHINA EAST ED is currently generating about -0.18 per unit of volatility. If you would invest 34.00 in CHINA EAST ED on October 28, 2024 and sell it today you would lose (4.00) from holding CHINA EAST ED or give up 11.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.44% |
| Values | Daily Returns |
HOCHSCHILD MINING vs. CHINA EAST ED
Performance |
| Timeline |
| HOCHSCHILD MINING |
| CHINA EAST ED |
HOCHSCHILD MINING and CHINA EAST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HOCHSCHILD MINING and CHINA EAST
The main advantage of trading using opposite HOCHSCHILD MINING and CHINA EAST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HOCHSCHILD MINING position performs unexpectedly, CHINA EAST 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 EAST will offset losses from the drop in CHINA EAST's long position.| HOCHSCHILD MINING vs. Apple Inc | HOCHSCHILD MINING vs. Apple Inc | HOCHSCHILD MINING vs. Apple Inc | HOCHSCHILD MINING vs. Apple Inc |
| CHINA EAST vs. Zoom Video Communications | CHINA EAST vs. Western Copper and | CHINA EAST vs. Zijin Mining Group | CHINA EAST vs. GALENA MINING LTD |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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