Correlation Between Zoje Resources and Shandong Mining
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By analyzing existing cross correlation between Zoje Resources Investment and Shandong Mining Machinery, you can compare the effects of market volatilities on Zoje Resources and Shandong Mining 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 Zoje Resources with a short position of Shandong Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoje Resources and Shandong Mining.
Diversification Opportunities for Zoje Resources and Shandong Mining
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zoje and Shandong is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Zoje Resources Investment and Shandong Mining Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Mining Machinery and Zoje Resources 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 Zoje Resources Investment are associated (or correlated) with Shandong Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Mining Machinery has no effect on the direction of Zoje Resources i.e., Zoje Resources and Shandong Mining go up and down completely randomly.
Pair Corralation between Zoje Resources and Shandong Mining
Assuming the 90 days trading horizon Zoje Resources is expected to generate 3.5 times less return on investment than Shandong Mining. But when comparing it to its historical volatility, Zoje Resources Investment is 1.53 times less risky than Shandong Mining. It trades about 0.21 of its potential returns per unit of risk. Shandong Mining Machinery is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 302.00 in Shandong Mining Machinery on September 12, 2024 and sell it today you would earn a total of 262.00 from holding Shandong Mining Machinery or generate 86.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoje Resources Investment vs. Shandong Mining Machinery
Performance |
| Timeline |
| Zoje Resources Investment |
| Shandong Mining Machinery |
Zoje Resources and Shandong Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoje Resources and Shandong Mining
The main advantage of trading using opposite Zoje Resources and Shandong Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoje Resources position performs unexpectedly, Shandong Mining 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 Shandong Mining will offset losses from the drop in Shandong Mining's long position.| Zoje Resources vs. Agricultural Bank of | Zoje Resources vs. Industrial and Commercial | Zoje Resources vs. Bank of China | Zoje Resources vs. PetroChina Co Ltd |
| Shandong Mining vs. Agricultural Bank of | Shandong Mining vs. Industrial and Commercial | Shandong Mining vs. Bank of China | Shandong Mining vs. PetroChina Co Ltd |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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