Correlation Between Hengli Petrochemical and Zijin Mining
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By analyzing existing cross correlation between Hengli Petrochemical Co and Zijin Mining Group, you can compare the effects of market volatilities on Hengli Petrochemical 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 Hengli Petrochemical with a short position of Zijin Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengli Petrochemical and Zijin Mining.
Diversification Opportunities for Hengli Petrochemical and Zijin Mining
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hengli and Zijin is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Hengli Petrochemical 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 Hengli Petrochemical 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 Hengli Petrochemical 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 Hengli Petrochemical i.e., Hengli Petrochemical and Zijin Mining go up and down completely randomly.
Pair Corralation between Hengli Petrochemical and Zijin Mining
Assuming the 90 days trading horizon Hengli Petrochemical Co is expected to generate 1.25 times more return on investment than Zijin Mining. However, Hengli Petrochemical is 1.25 times more volatile than Zijin Mining Group. It trades about 0.15 of its potential returns per unit of risk. Zijin Mining Group is currently generating about -0.01 per unit of risk. If you would invest 1,253 in Hengli Petrochemical Co on September 20, 2024 and sell it today you would earn a total of 281.00 from holding Hengli Petrochemical Co or generate 22.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hengli Petrochemical Co vs. Zijin Mining Group
Performance |
Timeline |
Hengli Petrochemical |
Zijin Mining Group |
Hengli Petrochemical and Zijin Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hengli Petrochemical and Zijin Mining
The main advantage of trading using opposite Hengli Petrochemical and Zijin Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengli Petrochemical 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.Hengli Petrochemical vs. Zijin Mining Group | Hengli Petrochemical vs. Wanhua Chemical Group | Hengli Petrochemical vs. Baoshan Iron Steel | Hengli Petrochemical vs. Shandong Gold Mining |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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