Correlation Between Shandong Mining and Nanjing OLO
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By analyzing existing cross correlation between Shandong Mining Machinery and Nanjing OLO Home, you can compare the effects of market volatilities on Shandong Mining and Nanjing OLO 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 Nanjing OLO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and Nanjing OLO.
Diversification Opportunities for Shandong Mining and Nanjing OLO
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shandong and Nanjing is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and Nanjing OLO Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing OLO Home 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 Nanjing OLO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing OLO Home has no effect on the direction of Shandong Mining i.e., Shandong Mining and Nanjing OLO go up and down completely randomly.
Pair Corralation between Shandong Mining and Nanjing OLO
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to generate 1.48 times more return on investment than Nanjing OLO. However, Shandong Mining is 1.48 times more volatile than Nanjing OLO Home. It trades about 0.08 of its potential returns per unit of risk. Nanjing OLO Home is currently generating about -0.01 per unit of risk. If you would invest 383.00 in Shandong Mining Machinery on October 23, 2024 and sell it today you would earn a total of 18.00 from holding Shandong Mining Machinery or generate 4.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shandong Mining Machinery vs. Nanjing OLO Home
Performance |
| Timeline |
| Shandong Mining Machinery |
| Nanjing OLO Home |
Shandong Mining and Nanjing OLO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and Nanjing OLO
The main advantage of trading using opposite Shandong Mining and Nanjing OLO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, Nanjing OLO 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 Nanjing OLO will offset losses from the drop in Nanjing OLO's long position.| Shandong Mining vs. Agricultural Bank of | Shandong Mining vs. Industrial and Commercial | Shandong Mining vs. Bank of China | Shandong Mining vs. China Construction Bank |
| Nanjing OLO vs. Huasi Agricultural Development | Nanjing OLO vs. Ningbo Construction Co | Nanjing OLO vs. Qijing Machinery | Nanjing OLO vs. China Sports Industry |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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