Correlation Between Shenyang Huitian and Sinosteel Luonai
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By analyzing existing cross correlation between Shenyang Huitian Thermal and Sinosteel Luonai Materials, you can compare the effects of market volatilities on Shenyang Huitian and Sinosteel Luonai 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 Shenyang Huitian with a short position of Sinosteel Luonai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Huitian and Sinosteel Luonai.
Diversification Opportunities for Shenyang Huitian and Sinosteel Luonai
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenyang and Sinosteel is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Huitian Thermal and Sinosteel Luonai Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinosteel Luonai Mat and Shenyang Huitian 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 Shenyang Huitian Thermal are associated (or correlated) with Sinosteel Luonai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinosteel Luonai Mat has no effect on the direction of Shenyang Huitian i.e., Shenyang Huitian and Sinosteel Luonai go up and down completely randomly.
Pair Corralation between Shenyang Huitian and Sinosteel Luonai
Assuming the 90 days trading horizon Shenyang Huitian Thermal is expected to under-perform the Sinosteel Luonai. In addition to that, Shenyang Huitian is 2.22 times more volatile than Sinosteel Luonai Materials. It trades about -0.25 of its total potential returns per unit of risk. Sinosteel Luonai Materials is currently generating about -0.41 per unit of volatility. If you would invest 430.00 in Sinosteel Luonai Materials on October 17, 2024 and sell it today you would lose (64.00) from holding Sinosteel Luonai Materials or give up 14.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenyang Huitian Thermal vs. Sinosteel Luonai Materials
Performance |
| Timeline |
| Shenyang Huitian Thermal |
| Sinosteel Luonai Mat |
Shenyang Huitian and Sinosteel Luonai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Huitian and Sinosteel Luonai
The main advantage of trading using opposite Shenyang Huitian and Sinosteel Luonai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Huitian position performs unexpectedly, Sinosteel Luonai 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 Sinosteel Luonai will offset losses from the drop in Sinosteel Luonai's long position.| Shenyang Huitian vs. Maoming Petro Chemical Shihua | Shenyang Huitian vs. Jinsanjiang Silicon Material | Shenyang Huitian vs. HeBei Jinniu Chemical | Shenyang Huitian vs. Chongqing Sulian Plastic |
| Sinosteel Luonai vs. China Minmetals Rare | Sinosteel Luonai vs. Shenyang Huitian Thermal | Sinosteel Luonai vs. Pengxin International Mining | Sinosteel Luonai vs. Rising Nonferrous Metals |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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