Correlation Between Hochschild Mining and Mingteng International

Can any of the company-specific risk be diversified away by investing in both Hochschild Mining and Mingteng International 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 Mingteng International 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 Mingteng International, you can compare the effects of market volatilities on Hochschild Mining and Mingteng International 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 Mingteng International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hochschild Mining and Mingteng International.

Diversification Opportunities for Hochschild Mining and Mingteng International

0.17

Correlation Coefficient

Hochschild Mining  Mingteng International

Average diversification

The 3 months correlation between Hochschild and Mingteng is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Hochschild Mining PLC and Mingteng International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mingteng International 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 Mingteng International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mingteng International has no effect on the direction of Hochschild Mining i.e., Hochschild Mining and Mingteng International go up and down completely randomly.

Pair Corralation between Hochschild Mining and Mingteng International

Assuming the 90 days horizon Hochschild Mining PLC is expected to under-perform the Mingteng International. But the otc stock apears to be less risky and, when comparing its historical volatility, Hochschild Mining PLC is 2.26 times less risky than Mingteng International. The otc stock trades about -0.09 of its potential returns per unit of risk. The Mingteng International is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  800.00  in Mingteng International on October 26, 2024 and sell it today you would lose (170.00) from holding Mingteng International or give up 21.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Hochschild Mining PLC  vs.  Mingteng International

Hochschild Mining PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hochschild Mining PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Mingteng International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mingteng International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Mingteng International is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Hochschild Mining and Mingteng International

The main advantage of trading using opposite Hochschild Mining and Mingteng International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hochschild Mining position performs unexpectedly, Mingteng International 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 Mingteng International will offset losses from the drop in Mingteng International's long position.

The idea behind Hochschild Mining PLC and Mingteng International 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.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.