Correlation Between Shandong Mining and ISoftStone Information
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By analyzing existing cross correlation between Shandong Mining Machinery and iSoftStone Information Technology, you can compare the effects of market volatilities on Shandong Mining and ISoftStone Information 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 ISoftStone Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and ISoftStone Information.
Diversification Opportunities for Shandong Mining and ISoftStone Information
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shandong and ISoftStone is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and iSoftStone Information Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSoftStone Information 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 ISoftStone Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSoftStone Information has no effect on the direction of Shandong Mining i.e., Shandong Mining and ISoftStone Information go up and down completely randomly.
Pair Corralation between Shandong Mining and ISoftStone Information
Assuming the 90 days trading horizon Shandong Mining is expected to generate 1.61 times less return on investment than ISoftStone Information. But when comparing it to its historical volatility, Shandong Mining Machinery is 1.55 times less risky than ISoftStone Information. It trades about 0.09 of its potential returns per unit of risk. iSoftStone Information Technology is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 2,203 in iSoftStone Information Technology on September 12, 2024 and sell it today you would earn a total of 4,415 from holding iSoftStone Information Technology or generate 200.41% 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. iSoftStone Information Technol
Performance |
| Timeline |
| Shandong Mining Machinery |
| iSoftStone Information |
Shandong Mining and ISoftStone Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and ISoftStone Information
The main advantage of trading using opposite Shandong Mining and ISoftStone Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, ISoftStone Information 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 ISoftStone Information will offset losses from the drop in ISoftStone Information's long position.| Shandong Mining vs. Agricultural Bank of | Shandong Mining vs. Industrial and Commercial | Shandong Mining vs. Bank of China | Shandong Mining vs. PetroChina Co Ltd |
| ISoftStone Information vs. Gansu Jiu Steel | ISoftStone Information vs. Shandong Mining Machinery | ISoftStone Information vs. Aba Chemicals Corp | ISoftStone Information 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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