Correlation Between Hubei Forbon and Shandong Gold
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By analyzing existing cross correlation between Hubei Forbon Technology and Shandong Gold Mining, you can compare the effects of market volatilities on Hubei Forbon and Shandong Gold 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 Hubei Forbon with a short position of Shandong Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hubei Forbon and Shandong Gold.
Diversification Opportunities for Hubei Forbon and Shandong Gold
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hubei and Shandong is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Hubei Forbon Technology and Shandong Gold Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Gold Mining and Hubei Forbon 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 Hubei Forbon Technology are associated (or correlated) with Shandong Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Gold Mining has no effect on the direction of Hubei Forbon i.e., Hubei Forbon and Shandong Gold go up and down completely randomly.
Pair Corralation between Hubei Forbon and Shandong Gold
Assuming the 90 days trading horizon Hubei Forbon Technology is expected to generate 1.55 times more return on investment than Shandong Gold. However, Hubei Forbon is 1.55 times more volatile than Shandong Gold Mining. It trades about 0.07 of its potential returns per unit of risk. Shandong Gold Mining is currently generating about -0.05 per unit of risk. If you would invest 662.00 in Hubei Forbon Technology on August 29, 2024 and sell it today you would earn a total of 163.00 from holding Hubei Forbon Technology or generate 24.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hubei Forbon Technology vs. Shandong Gold Mining
Performance |
| Timeline |
| Hubei Forbon Technology |
| Shandong Gold Mining |
Hubei Forbon and Shandong Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hubei Forbon and Shandong Gold
The main advantage of trading using opposite Hubei Forbon and Shandong Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hubei Forbon position performs unexpectedly, Shandong Gold 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 Gold will offset losses from the drop in Shandong Gold's long position.| Hubei Forbon vs. Shandong Gold Mining | Hubei Forbon vs. Rongsheng Petrochemical Co | Hubei Forbon vs. Inner Mongolia BaoTou | Hubei Forbon vs. Jiangxi Ganfeng Lithium |
| Shandong Gold vs. Dongguan Aohai Technology | Shandong Gold vs. Jiujiang Shanshui Technology | Shandong Gold vs. Guangzhou KingTeller Technology | Shandong Gold vs. GigaDevice SemiconductorBeiji |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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