Correlation Between Shandong Mining and Runjian Communication
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By analyzing existing cross correlation between Shandong Mining Machinery and Runjian Communication Co, you can compare the effects of market volatilities on Shandong Mining and Runjian Communication 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 Shandong Mining with a short position of Runjian Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Runjian Communication.
Diversification Opportunities for Shandong Mining and Runjian Communication
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Runjian is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Runjian Communication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Runjian Communication and Shandong 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 Shandong Mining Machinery are associated (or correlated) with Runjian Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Runjian Communication has no effect on the direction of Shandong Mining i.e., Shandong Mining and Runjian Communication go up and down completely randomly.
Pair Corralation between Shandong Mining and Runjian Communication
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 0.92 times more return on investment than Runjian Communication. However, Shandong Mining Machinery is 1.09 times less risky than Runjian Communication. It trades about 0.06 of its potential returns per unit of risk. Runjian Communication Co is currently generating about -0.01 per unit of risk. If you would invest 227.00 in Shandong Mining Machinery on August 31, 2024 and sell it today you would earn a total of 133.00 from holding Shandong Mining Machinery or generate 58.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Mining Machinery vs. Runjian Communication Co
Performance |
| Timeline |
| Shandong Mining Machinery |
| Runjian Communication |
Shandong Mining and Runjian Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Runjian Communication
The main advantage of trading using opposite Shandong Mining and Runjian Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Runjian Communication 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 Runjian Communication will offset losses from the drop in Runjian Communication's long position.| Shandong Mining vs. Cultural Investment Holdings | Shandong Mining vs. Gome Telecom Equipment | Shandong Mining vs. Bus Online Co | Shandong Mining vs. Holitech Technology Co |
| Runjian Communication vs. BYD Co Ltd | Runjian Communication vs. Agricultural Bank of | Runjian Communication vs. Industrial and Commercial | Runjian Communication vs. China State Construction |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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