Correlation Between Contemporary Amperex and Shandong Mining
Specify exactly 2 symbols:
By analyzing existing cross correlation between Contemporary Amperex Technology and Shandong Mining Machinery, you can compare the effects of market volatilities on Contemporary Amperex 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 Contemporary Amperex with a short position of Shandong Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contemporary Amperex and Shandong Mining.
Diversification Opportunities for Contemporary Amperex and Shandong Mining
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Contemporary and Shandong is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Contemporary Amperex Technolog 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 Contemporary Amperex 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 Contemporary Amperex Technology 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 Contemporary Amperex i.e., Contemporary Amperex and Shandong Mining go up and down completely randomly.
Pair Corralation between Contemporary Amperex and Shandong Mining
Assuming the 90 days trading horizon Contemporary Amperex is expected to generate 3.28 times less return on investment than Shandong Mining. But when comparing it to its historical volatility, Contemporary Amperex Technology is 1.25 times less risky than Shandong Mining. It trades about 0.02 of its potential returns per unit of risk. Shandong Mining Machinery is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 248.00 in Shandong Mining Machinery on October 25, 2024 and sell it today you would earn a total of 131.00 from holding Shandong Mining Machinery or generate 52.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Contemporary Amperex Technolog vs. Shandong Mining Machinery
Performance |
| Timeline |
| Contemporary Amperex |
| Shandong Mining Machinery |
Contemporary Amperex and Shandong Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contemporary Amperex and Shandong Mining
The main advantage of trading using opposite Contemporary Amperex and Shandong Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contemporary Amperex 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.The idea behind Contemporary Amperex Technology and Shandong Mining Machinery 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 Mining vs. Kweichow Moutai Co | Shandong Mining vs. Contemporary Amperex Technology | Shandong Mining vs. Beijing Roborock Technology | Shandong Mining vs. BYD 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |