Correlation Between Shengda Mining and Shenyang Huitian
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By analyzing existing cross correlation between Shengda Mining Co and Shenyang Huitian Thermal, you can compare the effects of market volatilities on Shengda Mining and Shenyang Huitian 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 Shengda Mining with a short position of Shenyang Huitian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and Shenyang Huitian.
Diversification Opportunities for Shengda Mining and Shenyang Huitian
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shengda and Shenyang is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and Shenyang Huitian Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Huitian Thermal and Shengda 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 Shengda Mining Co are associated (or correlated) with Shenyang Huitian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Huitian Thermal has no effect on the direction of Shengda Mining i.e., Shengda Mining and Shenyang Huitian go up and down completely randomly.
Pair Corralation between Shengda Mining and Shenyang Huitian
Assuming the 90 days trading horizon Shengda Mining Co is expected to under-perform the Shenyang Huitian. But the stock apears to be less risky and, when comparing its historical volatility, Shengda Mining Co is 1.25 times less risky than Shenyang Huitian. The stock trades about -0.08 of its potential returns per unit of risk. The Shenyang Huitian Thermal is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 350.00 in Shenyang Huitian Thermal on August 27, 2024 and sell it today you would earn a total of 5.00 from holding Shenyang Huitian Thermal or generate 1.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shengda Mining Co vs. Shenyang Huitian Thermal
Performance |
| Timeline |
| Shengda Mining |
| Shenyang Huitian Thermal |
Shengda Mining and Shenyang Huitian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shengda Mining and Shenyang Huitian
The main advantage of trading using opposite Shengda Mining and Shenyang Huitian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, Shenyang Huitian 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 Shenyang Huitian will offset losses from the drop in Shenyang Huitian's long position.| Shengda Mining vs. Zijin Mining Group | Shengda Mining vs. Wanhua Chemical Group | Shengda Mining vs. Baoshan Iron Steel | Shengda Mining vs. Shandong Gold Mining |
| Shenyang Huitian vs. Wuhan Yangtze Communication | Shenyang Huitian vs. Henzhen Zhaowei Machinery | Shenyang Huitian vs. Sinomach General Machinery | Shenyang Huitian vs. Nanjing Putian Telecommunications |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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