Correlation Between Hudbay Minerals and Sino Land

Can any of the company-specific risk be diversified away by investing in both Hudbay Minerals and Sino Land 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 Hudbay Minerals and Sino Land into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hudbay Minerals and Sino Land, you can compare the effects of market volatilities on Hudbay Minerals and Sino Land 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 Hudbay Minerals with a short position of Sino Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudbay Minerals and Sino Land.

Diversification Opportunities for Hudbay Minerals and Sino Land

0.87

Correlation Coefficient

Hudbay Minerals  Sino Land

Very poor diversification

The 3 months correlation between Hudbay and Sino is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Hudbay Minerals and Sino Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sino Land and Hudbay Minerals 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 Hudbay Minerals are associated (or correlated) with Sino Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sino Land has no effect on the direction of Hudbay Minerals i.e., Hudbay Minerals and Sino Land go up and down completely randomly.

Pair Corralation between Hudbay Minerals and Sino Land

Considering the 90-day investment horizon Hudbay Minerals is expected to generate 1.17 times more return on investment than Sino Land. However, Hudbay Minerals is 1.17 times more volatile than Sino Land. It trades about 0.24 of its potential returns per unit of risk. Sino Land is currently generating about 0.21 per unit of risk. If you would invest  774.00  in Hudbay Minerals on February 24, 2024 and sell it today you would earn a total of  187.50  from holding Hudbay Minerals or generate 24.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	95.65%
Values	Daily Returns

Hudbay Minerals  vs.  Sino Land

Hudbay Minerals

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Hudbay Minerals are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental drivers, Hudbay Minerals displayed solid returns over the last few months and may actually be approaching a breakup point.

Sino Land

Risk-Adjusted Performance

14 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sino Land are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating basic indicators, Sino Land reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hudbay Minerals and Sino Land

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

The idea behind Hudbay Minerals and Sino Land 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.