Correlation Between Rising Nonferrous and Shanghai Electric
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By analyzing existing cross correlation between Rising Nonferrous Metals and Shanghai Electric Group, you can compare the effects of market volatilities on Rising Nonferrous and Shanghai Electric 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 Rising Nonferrous with a short position of Shanghai Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rising Nonferrous and Shanghai Electric.
Diversification Opportunities for Rising Nonferrous and Shanghai Electric
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rising and Shanghai is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Rising Nonferrous Metals and Shanghai Electric Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Electric and Rising Nonferrous 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 Rising Nonferrous Metals are associated (or correlated) with Shanghai Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Electric has no effect on the direction of Rising Nonferrous i.e., Rising Nonferrous and Shanghai Electric go up and down completely randomly.
Pair Corralation between Rising Nonferrous and Shanghai Electric
Assuming the 90 days trading horizon Rising Nonferrous Metals is expected to generate 0.41 times more return on investment than Shanghai Electric. However, Rising Nonferrous Metals is 2.45 times less risky than Shanghai Electric. It trades about -0.16 of its potential returns per unit of risk. Shanghai Electric Group is currently generating about -0.14 per unit of risk. If you would invest 3,274 in Rising Nonferrous Metals on September 14, 2024 and sell it today you would lose (239.00) from holding Rising Nonferrous Metals or give up 7.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rising Nonferrous Metals vs. Shanghai Electric Group
Performance |
| Timeline |
| Rising Nonferrous Metals |
| Shanghai Electric |
Rising Nonferrous and Shanghai Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rising Nonferrous and Shanghai Electric
The main advantage of trading using opposite Rising Nonferrous and Shanghai Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rising Nonferrous position performs unexpectedly, Shanghai Electric 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 Shanghai Electric will offset losses from the drop in Shanghai Electric's long position.| Rising Nonferrous vs. Zijin Mining Group | Rising Nonferrous vs. Wanhua Chemical Group | Rising Nonferrous vs. Baoshan Iron Steel | Rising Nonferrous vs. Shandong Gold Mining |
| Shanghai Electric vs. Lootom Telcovideo Network | Shanghai Electric vs. Zhejiang Yayi Metal | Shanghai Electric vs. Rising Nonferrous Metals | Shanghai Electric vs. Tianshan Aluminum Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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