Correlation Between Shandong Longquan and State Grid
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By analyzing existing cross correlation between Shandong Longquan Pipeline and State Grid InformationCommunication, you can compare the effects of market volatilities on Shandong Longquan and State Grid 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 Longquan with a short position of State Grid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longquan and State Grid.
Diversification Opportunities for Shandong Longquan and State Grid
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shandong and State is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longquan Pipeline and State Grid InformationCommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Grid Informati and Shandong Longquan 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 Longquan Pipeline are associated (or correlated) with State Grid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Grid Informati has no effect on the direction of Shandong Longquan i.e., Shandong Longquan and State Grid go up and down completely randomly.
Pair Corralation between Shandong Longquan and State Grid
Assuming the 90 days trading horizon Shandong Longquan is expected to generate 1.27 times less return on investment than State Grid. But when comparing it to its historical volatility, Shandong Longquan Pipeline is 1.54 times less risky than State Grid. It trades about 0.09 of its potential returns per unit of risk. State Grid InformationCommunication is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,976 in State Grid InformationCommunication on August 30, 2024 and sell it today you would earn a total of 104.00 from holding State Grid InformationCommunication or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Longquan Pipeline vs. State Grid InformationCommunic
Performance |
| Timeline |
| Shandong Longquan |
| State Grid Informati |
Shandong Longquan and State Grid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longquan and State Grid
The main advantage of trading using opposite Shandong Longquan and State Grid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longquan position performs unexpectedly, State Grid 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 State Grid will offset losses from the drop in State Grid's long position.| Shandong Longquan vs. Zijin Mining Group | Shandong Longquan vs. Wanhua Chemical Group | Shandong Longquan vs. Baoshan Iron Steel | Shandong Longquan vs. Shandong Gold Mining |
| State Grid vs. Agricultural Bank of | State Grid vs. Industrial and Commercial | State Grid vs. Bank of China | State Grid vs. PetroChina Co Ltd |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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