Correlation Between Shandong Mining and A Zenith
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By analyzing existing cross correlation between Shandong Mining Machinery and A Zenith Home Furnishings, you can compare the effects of market volatilities on Shandong Mining and A Zenith 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 A Zenith. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Mining and A Zenith.
Diversification Opportunities for Shandong Mining and A Zenith
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shandong and 603389 is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Mining Machinery and A Zenith Home Furnishings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Zenith 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 A Zenith. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Zenith Home has no effect on the direction of Shandong Mining i.e., Shandong Mining and A Zenith go up and down completely randomly.
Pair Corralation between Shandong Mining and A Zenith
Assuming the 90 days trading horizon Shandong Mining Machinery is expected to under-perform the A Zenith. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Mining Machinery is 1.37 times less risky than A Zenith. The stock trades about -0.51 of its potential returns per unit of risk. The A Zenith Home Furnishings is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest 716.00 in A Zenith Home Furnishings on October 9, 2024 and sell it today you would lose (148.00) from holding A Zenith Home Furnishings or give up 20.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shandong Mining Machinery vs. A Zenith Home Furnishings
Performance |
| Timeline |
| Shandong Mining Machinery |
| A Zenith Home |
Shandong Mining and A Zenith Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Mining and A Zenith
The main advantage of trading using opposite Shandong Mining and A Zenith positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Mining position performs unexpectedly, A Zenith 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 A Zenith will offset losses from the drop in A Zenith's long position.| Shandong Mining vs. Tongyu Communication | Shandong Mining vs. Postal Savings Bank | Shandong Mining vs. Dr Peng Telecom | Shandong Mining vs. Zoje Resources Investment |
| A Zenith vs. Kweichow Moutai Co | A Zenith vs. NAURA Technology Group | A Zenith vs. Zhejiang Orient Gene | A Zenith vs. APT Medical |
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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