Correlation Between Shandong Iron and Dr Peng
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By analyzing existing cross correlation between Shandong Iron and and Dr Peng Telecom, you can compare the effects of market volatilities on Shandong Iron and Dr Peng 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 Dr Peng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Iron and Dr Peng.
Diversification Opportunities for Shandong Iron and Dr Peng
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shandong and 600804 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Iron and and Dr Peng Telecom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dr Peng Telecom 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 Dr Peng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dr Peng Telecom has no effect on the direction of Shandong Iron i.e., Shandong Iron and Dr Peng go up and down completely randomly.
Pair Corralation between Shandong Iron and Dr Peng
Assuming the 90 days trading horizon Shandong Iron and is expected to under-perform the Dr Peng. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Iron and is 2.11 times less risky than Dr Peng. The stock trades about -0.27 of its potential returns per unit of risk. The Dr Peng Telecom is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 180.00 in Dr Peng Telecom on October 25, 2024 and sell it today you would earn a total of 14.00 from holding Dr Peng Telecom or generate 7.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Iron and vs. Dr Peng Telecom
Performance |
| Timeline |
| Shandong Iron |
| Dr Peng Telecom |
Shandong Iron and Dr Peng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Iron and Dr Peng
The main advantage of trading using opposite Shandong Iron and Dr Peng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Iron position performs unexpectedly, Dr Peng 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 Dr Peng will offset losses from the drop in Dr Peng's long position.| Shandong Iron vs. Zijin Mining Group | Shandong Iron vs. Wanhua Chemical Group | Shandong Iron vs. Baoshan Iron Steel | Shandong Iron vs. Rongsheng Petrochemical Co |
| Dr Peng vs. Industrial and Commercial | Dr Peng vs. Agricultural Bank of | Dr Peng vs. China Construction Bank | Dr Peng vs. Bank of China |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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