Correlation Between Zhejiang JIULI and Guocheng Mining
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By analyzing existing cross correlation between Zhejiang JIULI Hi tech and Guocheng Mining Co, you can compare the effects of market volatilities on Zhejiang JIULI and Guocheng 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 Zhejiang JIULI with a short position of Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang JIULI and Guocheng Mining.
Diversification Opportunities for Zhejiang JIULI and Guocheng Mining
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Zhejiang and Guocheng is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang JIULI Hi tech and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining and Zhejiang JIULI 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 Zhejiang JIULI Hi tech are associated (or correlated) with Guocheng Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guocheng Mining has no effect on the direction of Zhejiang JIULI i.e., Zhejiang JIULI and Guocheng Mining go up and down completely randomly.
Pair Corralation between Zhejiang JIULI and Guocheng Mining
Assuming the 90 days trading horizon Zhejiang JIULI is expected to generate 1.78 times less return on investment than Guocheng Mining. But when comparing it to its historical volatility, Zhejiang JIULI Hi tech is 1.78 times less risky than Guocheng Mining. It trades about 0.15 of its potential returns per unit of risk. Guocheng Mining Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 996.00 in Guocheng Mining Co on September 25, 2024 and sell it today you would earn a total of 383.00 from holding Guocheng Mining Co or generate 38.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Zhejiang JIULI Hi tech vs. Guocheng Mining Co
Performance |
Timeline |
Zhejiang JIULI Hi |
Guocheng Mining |
Zhejiang JIULI and Guocheng Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zhejiang JIULI and Guocheng Mining
The main advantage of trading using opposite Zhejiang JIULI and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang JIULI position performs unexpectedly, Guocheng 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 Guocheng Mining will offset losses from the drop in Guocheng Mining's long position.Zhejiang JIULI vs. Wanhua Chemical Group | Zhejiang JIULI vs. Shandong Gold Mining | Zhejiang JIULI vs. Rongsheng Petrochemical Co | Zhejiang JIULI vs. Inner Mongolia BaoTou |
Guocheng Mining vs. China State Construction | Guocheng Mining vs. Poly Real Estate | Guocheng Mining vs. China Vanke Co | Guocheng Mining vs. China Merchants Shekou |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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