Correlation Between Geron and Shandong Mining
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By analyzing existing cross correlation between Geron Co and Shandong Mining Machinery, you can compare the effects of market volatilities on Geron and Shandong Mining 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 Geron with a short position of Shandong Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geron and Shandong Mining.
Diversification Opportunities for Geron and Shandong Mining
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Geron and Shandong is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Geron Co and Shandong Mining Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Mining Machinery and Geron 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 Geron Co are associated (or correlated) with Shandong Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Mining Machinery has no effect on the direction of Geron i.e., Geron and Shandong Mining go up and down completely randomly.
Pair Corralation between Geron and Shandong Mining
Assuming the 90 days trading horizon Geron is expected to generate 5.32 times less return on investment than Shandong Mining. But when comparing it to its historical volatility, Geron Co is 1.58 times less risky than Shandong Mining. It trades about 0.11 of its potential returns per unit of risk. Shandong Mining Machinery is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 273.00 in Shandong Mining Machinery on September 4, 2024 and sell it today you would earn a total of 123.00 from holding Shandong Mining Machinery or generate 45.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geron Co vs. Shandong Mining Machinery
Performance |
| Timeline |
| Geron |
| Shandong Mining Machinery |
Geron and Shandong Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geron and Shandong Mining
The main advantage of trading using opposite Geron and Shandong Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geron position performs unexpectedly, Shandong Mining 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 Shandong Mining will offset losses from the drop in Shandong Mining's long position.| Geron vs. Holitech Technology Co | Geron vs. Zhongrun Resources Investment | Geron vs. Metro Investment Development | Geron vs. HMTNew Technical |
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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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