Correlation Between Shantui Construction and Shaanxi Beiyuan
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By analyzing existing cross correlation between Shantui Construction Machinery and Shaanxi Beiyuan Chemical, you can compare the effects of market volatilities on Shantui Construction and Shaanxi Beiyuan 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 Shantui Construction with a short position of Shaanxi Beiyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shantui Construction and Shaanxi Beiyuan.
Diversification Opportunities for Shantui Construction and Shaanxi Beiyuan
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shantui and Shaanxi is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Shantui Construction Machinery and Shaanxi Beiyuan Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Beiyuan Chemical and Shantui Construction 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 Shantui Construction Machinery are associated (or correlated) with Shaanxi Beiyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Beiyuan Chemical has no effect on the direction of Shantui Construction i.e., Shantui Construction and Shaanxi Beiyuan go up and down completely randomly.
Pair Corralation between Shantui Construction and Shaanxi Beiyuan
Assuming the 90 days trading horizon Shantui Construction Machinery is expected to generate 1.98 times more return on investment than Shaanxi Beiyuan. However, Shantui Construction is 1.98 times more volatile than Shaanxi Beiyuan Chemical. It trades about 0.1 of its potential returns per unit of risk. Shaanxi Beiyuan Chemical is currently generating about -0.02 per unit of risk. If you would invest 495.00 in Shantui Construction Machinery on December 12, 2024 and sell it today you would earn a total of 544.00 from holding Shantui Construction Machinery or generate 109.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shantui Construction Machinery vs. Shaanxi Beiyuan Chemical
Performance |
| Timeline |
| Shantui Construction |
| Shaanxi Beiyuan Chemical |
Shantui Construction and Shaanxi Beiyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shantui Construction and Shaanxi Beiyuan
The main advantage of trading using opposite Shantui Construction and Shaanxi Beiyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shantui Construction position performs unexpectedly, Shaanxi Beiyuan 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 Shaanxi Beiyuan will offset losses from the drop in Shaanxi Beiyuan's long position.| Shantui Construction vs. Allied Machinery Co | ||
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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