Correlation Between Uroica Mining and Haima Automobile

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Uroica Mining and Haima Automobile 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 Uroica Mining and Haima Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uroica Mining Safety and Haima Automobile Group, you can compare the effects of market volatilities on Uroica Mining and Haima Automobile 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 Uroica Mining with a short position of Haima Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uroica Mining and Haima Automobile.

Diversification Opportunities for Uroica Mining and Haima Automobile

0.74
  Correlation Coefficient

Poor diversification

The 3 months correlation between Uroica and Haima is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Uroica Mining Safety and Haima Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haima Automobile and Uroica 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 Uroica Mining Safety are associated (or correlated) with Haima Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haima Automobile has no effect on the direction of Uroica Mining i.e., Uroica Mining and Haima Automobile go up and down completely randomly.

Pair Corralation between Uroica Mining and Haima Automobile

Assuming the 90 days trading horizon Uroica Mining Safety is expected to under-perform the Haima Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Uroica Mining Safety is 1.22 times less risky than Haima Automobile. The stock trades about -0.07 of its potential returns per unit of risk. The Haima Automobile Group is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  439.00  in Haima Automobile Group on September 28, 2024 and sell it today you would lose (15.00) from holding Haima Automobile Group or give up 3.42% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Uroica Mining Safety  vs.  Haima Automobile Group

 Performance 
       Timeline  
Uroica Mining Safety 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Uroica Mining Safety are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Uroica Mining may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Haima Automobile 

Risk-Adjusted Performance

6 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Haima Automobile Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Haima Automobile sustained solid returns over the last few months and may actually be approaching a breakup point.

Uroica Mining and Haima Automobile Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Uroica Mining and Haima Automobile

The main advantage of trading using opposite Uroica Mining and Haima Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uroica Mining position performs unexpectedly, Haima Automobile 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 Haima Automobile will offset losses from the drop in Haima Automobile's long position.
The idea behind Uroica Mining Safety and Haima Automobile Group 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.
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

Other Complementary Tools

Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated