Correlation Between Shandong Mining and Cultural Investment
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By analyzing existing cross correlation between Shandong Mining Machinery and Cultural Investment Holdings, you can compare the effects of market volatilities on Shandong Mining and Cultural Investment 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 Cultural Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Cultural Investment.
Diversification Opportunities for Shandong Mining and Cultural Investment
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Cultural is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Cultural Investment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cultural Investment 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 Cultural Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cultural Investment has no effect on the direction of Shandong Mining i.e., Shandong Mining and Cultural Investment go up and down completely randomly.
Pair Corralation between Shandong Mining and Cultural Investment
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 1.21 times more return on investment than Cultural Investment. However, Shandong Mining is 1.21 times more volatile than Cultural Investment Holdings. It trades about 0.25 of its potential returns per unit of risk. Cultural Investment Holdings is currently generating about 0.13 per unit of risk. If you would invest 214.00 in Shandong Mining Machinery on September 2, 2024 and sell it today you would earn a total of 146.00 from holding Shandong Mining Machinery or generate 68.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Mining Machinery vs. Cultural Investment Holdings
Performance |
| Timeline |
| Shandong Mining Machinery |
| Cultural Investment |
Shandong Mining and Cultural Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Cultural Investment
The main advantage of trading using opposite Shandong Mining and Cultural Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Cultural Investment 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 Cultural Investment will offset losses from the drop in Cultural Investment'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 |
| Cultural Investment vs. China Minmetals Rare | Cultural Investment vs. Chengtun Mining Group | Cultural Investment vs. Qinghaihuading Industrial Co | Cultural Investment vs. China Life Insurance |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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