Correlation Between Shandong Iron and Maoming Petro
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By analyzing existing cross correlation between Shandong Iron and and Maoming Petro Chemical Shihua, you can compare the effects of market volatilities on Shandong Iron and Maoming Petro 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 Iron with a short position of Maoming Petro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Iron and Maoming Petro.
Diversification Opportunities for Shandong Iron and Maoming Petro
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Maoming is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Iron and and Maoming Petro Chemical Shihua in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maoming Petro Chemical and Shandong Iron 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 Iron and are associated (or correlated) with Maoming Petro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maoming Petro Chemical has no effect on the direction of Shandong Iron i.e., Shandong Iron and Maoming Petro go up and down completely randomly.
Pair Corralation between Shandong Iron and Maoming Petro
Assuming the 90 days trading horizon Shandong Iron and is expected to under-perform the Maoming Petro. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Iron and is 1.46 times less risky than Maoming Petro. The stock trades about -0.61 of its potential returns per unit of risk. The Maoming Petro Chemical Shihua is currently generating about -0.32 of returns per unit of risk over similar time horizon. If you would invest 428.00 in Maoming Petro Chemical Shihua on October 12, 2024 and sell it today you would lose (71.00) from holding Maoming Petro Chemical Shihua or give up 16.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Iron and vs. Maoming Petro Chemical Shihua
Performance |
| Timeline |
| Shandong Iron |
| Maoming Petro Chemical |
Shandong Iron and Maoming Petro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Iron and Maoming Petro
The main advantage of trading using opposite Shandong Iron and Maoming Petro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Iron position performs unexpectedly, Maoming Petro 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 Maoming Petro will offset losses from the drop in Maoming Petro's long position.| Shandong Iron vs. Heilongjiang Publishing Media | Shandong Iron vs. Shanghai Action Education | Shandong Iron vs. Glodon Software Co | Shandong Iron vs. Inspur Software Co |
| Maoming Petro vs. Tongxing Environmental Protection | Maoming Petro vs. Innovative Medical Management | Maoming Petro vs. Xiangyu Medical Co | Maoming Petro vs. Shandong Iron and |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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