Correlation Between Shandong Longda and Jinhui Mining
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By analyzing existing cross correlation between Shandong Longda Meat and Jinhui Mining Co, you can compare the effects of market volatilities on Shandong Longda and Jinhui 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 Shandong Longda with a short position of Jinhui Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longda and Jinhui Mining.
Diversification Opportunities for Shandong Longda and Jinhui Mining
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Jinhui is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longda Meat and Jinhui Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinhui Mining and Shandong Longda 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 Longda Meat are associated (or correlated) with Jinhui Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinhui Mining has no effect on the direction of Shandong Longda i.e., Shandong Longda and Jinhui Mining go up and down completely randomly.
Pair Corralation between Shandong Longda and Jinhui Mining
Assuming the 90 days trading horizon Shandong Longda Meat is expected to under-perform the Jinhui Mining. In addition to that, Shandong Longda is 1.96 times more volatile than Jinhui Mining Co. It trades about -0.27 of its total potential returns per unit of risk. Jinhui Mining Co is currently generating about -0.13 per unit of volatility. If you would invest 1,165 in Jinhui Mining Co on October 16, 2024 and sell it today you would lose (41.00) from holding Jinhui Mining Co or give up 3.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Longda Meat vs. Jinhui Mining Co
Performance |
| Timeline |
| Shandong Longda Meat |
| Jinhui Mining |
Shandong Longda and Jinhui Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longda and Jinhui Mining
The main advantage of trading using opposite Shandong Longda and Jinhui Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longda position performs unexpectedly, Jinhui 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 Jinhui Mining will offset losses from the drop in Jinhui Mining's long position.| Shandong Longda vs. Dhc Software Co | Shandong Longda vs. Success Electronics | Shandong Longda vs. Fuzhou Rockchip Electronics | Shandong Longda vs. LianChuang Electronic Technology |
| Jinhui Mining vs. Lutian Machinery Co | Jinhui Mining vs. Shenzhen Centralcon Investment | Jinhui Mining vs. Ningbo Construction Co | Jinhui Mining vs. Chengdu Xingrong Investment |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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