Correlation Between Shengda Mining and Smartgiant Technology
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By analyzing existing cross correlation between Shengda Mining Co and Smartgiant Technology Co, you can compare the effects of market volatilities on Shengda Mining and Smartgiant Technology 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 Smartgiant Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and Smartgiant Technology.
Diversification Opportunities for Shengda Mining and Smartgiant Technology
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shengda and Smartgiant is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and Smartgiant Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartgiant Technology 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 Smartgiant Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartgiant Technology has no effect on the direction of Shengda Mining i.e., Shengda Mining and Smartgiant Technology go up and down completely randomly.
Pair Corralation between Shengda Mining and Smartgiant Technology
Assuming the 90 days trading horizon Shengda Mining Co is expected to generate 0.82 times more return on investment than Smartgiant Technology. However, Shengda Mining Co is 1.22 times less risky than Smartgiant Technology. It trades about 0.01 of its potential returns per unit of risk. Smartgiant Technology Co is currently generating about 0.01 per unit of risk. If you would invest 1,404 in Shengda Mining Co on October 30, 2024 and sell it today you would lose (20.00) from holding Shengda Mining Co or give up 1.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Shengda Mining Co vs. Smartgiant Technology Co
Performance |
| Timeline |
| Shengda Mining |
| Smartgiant Technology |
Shengda Mining and Smartgiant Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shengda Mining and Smartgiant Technology
The main advantage of trading using opposite Shengda Mining and Smartgiant Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, Smartgiant Technology 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 Smartgiant Technology will offset losses from the drop in Smartgiant Technology's long position.| Shengda Mining vs. Xinjiang Baodi Mining | Shengda Mining vs. China Publishing Media | Shengda Mining vs. Western Metal Materials | Shengda Mining vs. Thinkingdom Media Group |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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