Correlation Between Guocheng Mining and Zijin Mining
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By analyzing existing cross correlation between Guocheng Mining Co and Zijin Mining Group, you can compare the effects of market volatilities on Guocheng Mining and Zijin 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 Guocheng Mining with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guocheng Mining and Zijin Mining.
Diversification Opportunities for Guocheng Mining and Zijin Mining
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guocheng and Zijin is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Guocheng Mining Co and Zijin Mining Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zijin Mining Group and Guocheng 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 Guocheng Mining Co are associated (or correlated) with Zijin Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zijin Mining Group has no effect on the direction of Guocheng Mining i.e., Guocheng Mining and Zijin Mining go up and down completely randomly.
Pair Corralation between Guocheng Mining and Zijin Mining
Assuming the 90 days trading horizon Guocheng Mining Co is expected to generate 1.55 times more return on investment than Zijin Mining. However, Guocheng Mining is 1.55 times more volatile than Zijin Mining Group. It trades about 0.11 of its potential returns per unit of risk. Zijin Mining Group is currently generating about -0.02 per unit of risk. If you would invest 949.00 in Guocheng Mining Co on September 25, 2024 and sell it today you would earn a total of 430.00 from holding Guocheng Mining Co or generate 45.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Guocheng Mining Co vs. Zijin Mining Group
Performance |
Timeline |
Guocheng Mining |
Zijin Mining Group |
Guocheng Mining and Zijin Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Guocheng Mining and Zijin Mining
The main advantage of trading using opposite Guocheng Mining and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guocheng Mining position performs unexpectedly, Zijin 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 Zijin Mining will offset losses from the drop in Zijin Mining's long position.Guocheng Mining vs. China State Construction | Guocheng Mining vs. Poly Real Estate | Guocheng Mining vs. China Vanke Co | Guocheng Mining vs. China Merchants Shekou |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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