Correlation Between Shengda Mining and Shanghai Huayi
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By analyzing existing cross correlation between Shengda Mining Co and Shanghai Huayi Group, you can compare the effects of market volatilities on Shengda Mining and Shanghai Huayi 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 Shanghai Huayi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and Shanghai Huayi.
Diversification Opportunities for Shengda Mining and Shanghai Huayi
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shengda and Shanghai is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and Shanghai Huayi Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Huayi Group 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 Shanghai Huayi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Huayi Group has no effect on the direction of Shengda Mining i.e., Shengda Mining and Shanghai Huayi go up and down completely randomly.
Pair Corralation between Shengda Mining and Shanghai Huayi
Assuming the 90 days trading horizon Shengda Mining Co is expected to under-perform the Shanghai Huayi. In addition to that, Shengda Mining is 1.4 times more volatile than Shanghai Huayi Group. It trades about -0.06 of its total potential returns per unit of risk. Shanghai Huayi Group is currently generating about 0.13 per unit of volatility. If you would invest 55.00 in Shanghai Huayi Group on September 13, 2024 and sell it today you would earn a total of 2.00 from holding Shanghai Huayi Group or generate 3.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shengda Mining Co vs. Shanghai Huayi Group
Performance |
| Timeline |
| Shengda Mining |
| Shanghai Huayi Group |
Shengda Mining and Shanghai Huayi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shengda Mining and Shanghai Huayi
The main advantage of trading using opposite Shengda Mining and Shanghai Huayi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, Shanghai Huayi 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 Shanghai Huayi will offset losses from the drop in Shanghai Huayi'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 |
| Shanghai Huayi vs. Zijin Mining Group | Shanghai Huayi vs. Wanhua Chemical Group | Shanghai Huayi vs. Baoshan Iron Steel | Shanghai Huayi 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 CEOs Directory module to screen CEOs from public companies around the world.
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