Correlation Between Hochschild Mining and Tsingtao Brewery
Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Tsingtao Brewery 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 Tsingtao Brewery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hochschild Mining plc and Tsingtao Brewery, you can compare the effects of market volatilities on Hochschild Mining and Tsingtao Brewery 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 Tsingtao Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Tsingtao Brewery.
Diversification Opportunities for Hochschild Mining and Tsingtao Brewery
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hochschild and Tsingtao is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining plc and Tsingtao Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsingtao Brewery 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 plc are associated (or correlated) with Tsingtao Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsingtao Brewery has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Tsingtao Brewery go up and down completely randomly.
Pair Corralation between Hochschild Mining and Tsingtao Brewery
Assuming the 90 days horizon Hochschild Mining plc is expected to generate 1.0 times more return on investment than Tsingtao Brewery. However, Hochschild Mining is 1.0 times more volatile than Tsingtao Brewery. It trades about 0.1 of its potential returns per unit of risk. Tsingtao Brewery is currently generating about 0.03 per unit of risk. If you would invest 68.00 in Hochschild Mining plc on October 16, 2024 and sell it today you would earn a total of 201.00 from holding Hochschild Mining plc or generate 295.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hochschild Mining plc vs. Tsingtao Brewery
Performance |
| Timeline |
| Hochschild Mining plc |
| Tsingtao Brewery |
Hochschild Mining and Tsingtao Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hochschild Mining and Tsingtao Brewery
The main advantage of trading using opposite Hochschild Mining and Tsingtao Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Tsingtao Brewery 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 Tsingtao Brewery will offset losses from the drop in Tsingtao Brewery's long position.| Hochschild Mining vs. Taiwan Semiconductor Manufacturing | Hochschild Mining vs. ELMOS SEMICONDUCTOR | Hochschild Mining vs. SIEM OFFSHORE NEW | Hochschild Mining vs. The Hanover Insurance |
| Tsingtao Brewery vs. Hochschild Mining plc | Tsingtao Brewery vs. Mitsui Chemicals | Tsingtao Brewery vs. AIR PRODCHEMICALS | Tsingtao Brewery vs. Penn National Gaming |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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