Correlation Between Shengda Mining and Tibet Huayu
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By analyzing existing cross correlation between Shengda Mining Co and Tibet Huayu Mining, you can compare the effects of market volatilities on Shengda Mining and Tibet Huayu 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 Tibet Huayu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and Tibet Huayu.
Diversification Opportunities for Shengda Mining and Tibet Huayu
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shengda and Tibet is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and Tibet Huayu Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tibet Huayu Mining 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 Tibet Huayu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tibet Huayu Mining has no effect on the direction of Shengda Mining i.e., Shengda Mining and Tibet Huayu go up and down completely randomly.
Pair Corralation between Shengda Mining and Tibet Huayu
Assuming the 90 days trading horizon Shengda Mining Co is expected to generate 1.09 times more return on investment than Tibet Huayu. However, Shengda Mining is 1.09 times more volatile than Tibet Huayu Mining. It trades about 0.22 of its potential returns per unit of risk. Tibet Huayu Mining is currently generating about -0.09 per unit of risk. If you would invest 1,241 in Shengda Mining Co on October 22, 2024 and sell it today you would earn a total of 124.00 from holding Shengda Mining Co or generate 9.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shengda Mining Co vs. Tibet Huayu Mining
Performance |
| Timeline |
| Shengda Mining |
| Tibet Huayu Mining |
Shengda Mining and Tibet Huayu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shengda Mining and Tibet Huayu
The main advantage of trading using opposite Shengda Mining and Tibet Huayu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, Tibet Huayu 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 Tibet Huayu will offset losses from the drop in Tibet Huayu's long position.| Shengda Mining vs. Shuhua Sports Co | Shengda Mining vs. Anhui Jianghuai Automobile | Shengda Mining vs. Iat Automobile Technology | Shengda Mining vs. China Sports Industry |
| Tibet Huayu vs. Hainan Airlines Co | Tibet Huayu vs. Dawning Information Industry | Tibet Huayu vs. Tongding Interconnection Information | Tibet Huayu vs. Hygon Information Technology |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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