Correlation Between CHINA CONBANK and GOLDGROUP MINING

Can any of the company-specific risk be diversified away by investing in both CHINA CONBANK and GOLDGROUP MINING 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 CHINA CONBANK and GOLDGROUP MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CHINA BANK ADR20 and GOLDGROUP MINING INC, you can compare the effects of market volatilities on CHINA CONBANK and GOLDGROUP 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 CHINA CONBANK with a short position of GOLDGROUP MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA CONBANK and GOLDGROUP MINING.

Diversification Opportunities for CHINA CONBANK and GOLDGROUP MINING

0.04

Correlation Coefficient

CHINA CONBANK  GOLDGROUP MINING

Significant diversification

The 3 months correlation between CHINA and GOLDGROUP is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding CHINA BANK ADR20 and GOLDGROUP MINING INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GOLDGROUP MINING INC and CHINA CONBANK 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 CHINA BANK ADR20 are associated (or correlated) with GOLDGROUP MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GOLDGROUP MINING INC has no effect on the direction of CHINA CONBANK i.e., CHINA CONBANK and GOLDGROUP MINING go up and down completely randomly.

Pair Corralation between CHINA CONBANK and GOLDGROUP MINING

Assuming the 90 days trading horizon CHINA BANK ADR20 is expected to generate 0.52 times more return on investment than GOLDGROUP MINING. However, CHINA BANK ADR20 is 1.9 times less risky than GOLDGROUP MINING. It trades about 0.17 of its potential returns per unit of risk. GOLDGROUP MINING INC is currently generating about 0.04 per unit of risk. If you would invest  1,447  in CHINA BANK ADR20 on April 25, 2025 and sell it today you would earn a total of  313.00  from holding CHINA BANK ADR20 or generate 21.63% return on investment over 90 days.

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

CHINA BANK ADR20  vs.  GOLDGROUP MINING INC

CHINA BANK ADR20

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CHINA BANK ADR20 are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CHINA CONBANK reported solid returns over the last few months and may actually be approaching a breakup point.

GOLDGROUP MINING INC

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in GOLDGROUP MINING INC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain technical and fundamental indicators, GOLDGROUP MINING may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with CHINA CONBANK and GOLDGROUP MINING

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

The idea behind CHINA BANK ADR20 and GOLDGROUP MINING INC 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.