Correlation Between Shandong Mining and Shandong Ruifeng
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By analyzing existing cross correlation between Shandong Mining Machinery and Shandong Ruifeng Chemical, you can compare the effects of market volatilities on Shandong Mining and Shandong Ruifeng 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 Shandong Ruifeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Shandong Ruifeng.
Diversification Opportunities for Shandong Mining and Shandong Ruifeng
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Shandong is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Shandong Ruifeng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Ruifeng Chemical 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 Shandong Ruifeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Ruifeng Chemical has no effect on the direction of Shandong Mining i.e., Shandong Mining and Shandong Ruifeng go up and down completely randomly.
Pair Corralation between Shandong Mining and Shandong Ruifeng
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 1.34 times more return on investment than Shandong Ruifeng. However, Shandong Mining is 1.34 times more volatile than Shandong Ruifeng Chemical. It trades about 0.38 of its potential returns per unit of risk. Shandong Ruifeng Chemical is currently generating about -0.19 per unit of risk. If you would invest 273.00 in Shandong Mining Machinery on September 4, 2024 and sell it today you would earn a total of 123.00 from holding Shandong Mining Machinery or generate 45.05% 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. Shandong Ruifeng Chemical
Performance |
| Timeline |
| Shandong Mining Machinery |
| Shandong Ruifeng Chemical |
Shandong Mining and Shandong Ruifeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Shandong Ruifeng
The main advantage of trading using opposite Shandong Mining and Shandong Ruifeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Shandong Ruifeng 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 Ruifeng will offset losses from the drop in Shandong Ruifeng's long position.| Shandong Mining vs. Xinjiang Communications Construction | Shandong Mining vs. Nanjing Putian Telecommunications | Shandong Mining vs. Jonjee Hi tech Industrial | Shandong Mining vs. Zoje Resources Investment |
| Shandong Ruifeng vs. CITIC Metal Co | Shandong Ruifeng vs. Shanghai Yanpu Metal | Shandong Ruifeng vs. Hangzhou Pinming Software | Shandong Ruifeng vs. Inspur Software Co |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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