Correlation Between Shandong Mining and Keda Clean
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By analyzing existing cross correlation between Shandong Mining Machinery and Keda Clean Energy, you can compare the effects of market volatilities on Shandong Mining and Keda Clean 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 Keda Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Keda Clean.
Diversification Opportunities for Shandong Mining and Keda Clean
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Keda is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Keda Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keda Clean Energy 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 Keda Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keda Clean Energy has no effect on the direction of Shandong Mining i.e., Shandong Mining and Keda Clean go up and down completely randomly.
Pair Corralation between Shandong Mining and Keda Clean
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 1.32 times more return on investment than Keda Clean. However, Shandong Mining is 1.32 times more volatile than Keda Clean Energy. It trades about 0.05 of its potential returns per unit of risk. Keda Clean Energy is currently generating about -0.04 per unit of risk. If you would invest 232.00 in Shandong Mining Machinery on September 3, 2024 and sell it today you would earn a total of 128.00 from holding Shandong Mining Machinery or generate 55.17% 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. Keda Clean Energy
Performance |
| Timeline |
| Shandong Mining Machinery |
| Keda Clean Energy |
Shandong Mining and Keda Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Keda Clean
The main advantage of trading using opposite Shandong Mining and Keda Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Keda Clean 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 Keda Clean will offset losses from the drop in Keda Clean'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 |
| Keda Clean vs. Zotye Automobile Co | Keda Clean vs. Guangzhou Haige Communications | Keda Clean vs. Eastern Communications Co | Keda Clean vs. Shanghai Broadband Technology |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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