Correlation Between Shengda Mining and Masterwork Machinery
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By analyzing existing cross correlation between Shengda Mining Co and Masterwork Machinery, you can compare the effects of market volatilities on Shengda Mining and Masterwork Machinery 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 Masterwork Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and Masterwork Machinery.
Diversification Opportunities for Shengda Mining and Masterwork Machinery
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shengda and Masterwork is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and Masterwork Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Masterwork Machinery 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 Masterwork Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Masterwork Machinery has no effect on the direction of Shengda Mining i.e., Shengda Mining and Masterwork Machinery go up and down completely randomly.
Pair Corralation between Shengda Mining and Masterwork Machinery
Assuming the 90 days trading horizon Shengda Mining Co is expected to generate 1.03 times more return on investment than Masterwork Machinery. However, Shengda Mining is 1.03 times more volatile than Masterwork Machinery. It trades about 0.02 of its potential returns per unit of risk. Masterwork Machinery is currently generating about 0.01 per unit of risk. If you would invest 1,377 in Shengda Mining Co on October 28, 2024 and sell it today you would earn a total of 13.00 from holding Shengda Mining Co or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Shengda Mining Co vs. Masterwork Machinery
Performance |
| Timeline |
| Shengda Mining |
| Masterwork Machinery |
Shengda Mining and Masterwork Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shengda Mining and Masterwork Machinery
The main advantage of trading using opposite Shengda Mining and Masterwork Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, Masterwork Machinery 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 Masterwork Machinery will offset losses from the drop in Masterwork Machinery'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 |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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