Correlation Between Shandong Mining and Chaozhou Three
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By analyzing existing cross correlation between Shandong Mining Machinery and Chaozhou Three circle Group, you can compare the effects of market volatilities on Shandong Mining and Chaozhou Three 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 Chaozhou Three. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Chaozhou Three.
Diversification Opportunities for Shandong Mining and Chaozhou Three
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shandong and Chaozhou is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Chaozhou Three circle Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chaozhou Three circle 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 Chaozhou Three. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chaozhou Three circle has no effect on the direction of Shandong Mining i.e., Shandong Mining and Chaozhou Three go up and down completely randomly.
Pair Corralation between Shandong Mining and Chaozhou Three
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 3.49 times more return on investment than Chaozhou Three. However, Shandong Mining is 3.49 times more volatile than Chaozhou Three circle Group. It trades about 0.4 of its potential returns per unit of risk. Chaozhou Three circle Group is currently generating about 0.03 per unit of risk. If you would invest 294.00 in Shandong Mining Machinery on September 13, 2024 and sell it today you would earn a total of 214.00 from holding Shandong Mining Machinery or generate 72.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Mining Machinery vs. Chaozhou Three circle Group
Performance |
| Timeline |
| Shandong Mining Machinery |
| Chaozhou Three circle |
Shandong Mining and Chaozhou Three Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Chaozhou Three
The main advantage of trading using opposite Shandong Mining and Chaozhou Three positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Chaozhou Three 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 Chaozhou Three will offset losses from the drop in Chaozhou Three's long position.| Shandong Mining vs. China Petroleum Chemical | Shandong Mining vs. PetroChina Co Ltd | Shandong Mining vs. China State Construction | Shandong Mining vs. China Railway Group |
| Chaozhou Three vs. Gansu Jiu Steel | Chaozhou Three vs. Shandong Mining Machinery | Chaozhou Three vs. Aba Chemicals Corp | Chaozhou Three vs. BlueFocus Communication Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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