Correlation Between B2Gold Corp and China Hongqiao
Can any of the company-specific risk be diversified away by investing in both B2Gold Corp and China Hongqiao 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 B2Gold Corp and China Hongqiao into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B2Gold Corp and China Hongqiao Group, you can compare the effects of market volatilities on B2Gold Corp and China Hongqiao 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 B2Gold Corp with a short position of China Hongqiao. Check out your portfolio center. Please also check ongoing floating volatility patterns of B2Gold Corp and China Hongqiao.
Diversification Opportunities for B2Gold Corp and China Hongqiao
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between B2Gold and China is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding B2Gold Corp and China Hongqiao Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Hongqiao Group and B2Gold Corp 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 B2Gold Corp are associated (or correlated) with China Hongqiao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Hongqiao Group has no effect on the direction of B2Gold Corp i.e., B2Gold Corp and China Hongqiao go up and down completely randomly.
Pair Corralation between B2Gold Corp and China Hongqiao
Considering the 90-day investment horizon B2Gold Corp is expected to generate 2.89 times less return on investment than China Hongqiao. But when comparing it to its historical volatility, B2Gold Corp is 2.5 times less risky than China Hongqiao. It trades about 0.11 of its potential returns per unit of risk. China Hongqiao Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 76.00 in China Hongqiao Group on February 20, 2024 and sell it today you would earn a total of 39.00 from holding China Hongqiao Group or generate 51.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
B2Gold Corp vs. China Hongqiao Group
Performance |
Timeline |
B2Gold Corp |
China Hongqiao Group |
B2Gold Corp and China Hongqiao Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with B2Gold Corp and China Hongqiao
The main advantage of trading using opposite B2Gold Corp and China Hongqiao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B2Gold Corp position performs unexpectedly, China Hongqiao 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 China Hongqiao will offset losses from the drop in China Hongqiao's long position.B2Gold Corp vs. Paramount Gold Nevada | B2Gold Corp vs. Liberty Gold Corp | B2Gold Corp vs. GoldMining | B2Gold Corp vs. International Tower Hill |
China Hongqiao vs. Kaiser Aluminum | China Hongqiao vs. Century Aluminum | China Hongqiao vs. Constellium Nv | China Hongqiao vs. Alcoa Corp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |