Correlation Between 159005 and Shandong Ruifeng
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By analyzing existing cross correlation between 159005 and Shandong Ruifeng Chemical, you can compare the effects of market volatilities on 159005 and Shandong Ruifeng 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 159005 with a short position of Shandong Ruifeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159005 and Shandong Ruifeng.
Diversification Opportunities for 159005 and Shandong Ruifeng
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between 159005 and Shandong is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding 159005 and Shandong Ruifeng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Ruifeng Chemical and 159005 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 159005 are associated (or correlated) with Shandong Ruifeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Ruifeng Chemical has no effect on the direction of 159005 i.e., 159005 and Shandong Ruifeng go up and down completely randomly.
Pair Corralation between 159005 and Shandong Ruifeng
Assuming the 90 days trading horizon 159005 is expected to generate 155.43 times less return on investment than Shandong Ruifeng. But when comparing it to its historical volatility, 159005 is 160.88 times less risky than Shandong Ruifeng. It trades about 0.23 of its potential returns per unit of risk. Shandong Ruifeng Chemical is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 749.00 in Shandong Ruifeng Chemical on August 28, 2024 and sell it today you would earn a total of 542.00 from holding Shandong Ruifeng Chemical or generate 72.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
159005 vs. Shandong Ruifeng Chemical
Performance |
| Timeline |
| 159005 |
| Shandong Ruifeng Chemical |
159005 and Shandong Ruifeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159005 and Shandong Ruifeng
The main advantage of trading using opposite 159005 and Shandong Ruifeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159005 position performs unexpectedly, Shandong Ruifeng 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 Ruifeng will offset losses from the drop in Shandong Ruifeng's long position.The idea behind 159005 and Shandong Ruifeng Chemical pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Shandong Ruifeng vs. Jinhui Mining Co | Shandong Ruifeng vs. Chengtun Mining Group | Shandong Ruifeng vs. Zijin Mining Group | Shandong Ruifeng vs. Beijing Kaiwen Education |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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