Correlation Between Shandong Gold and City Development
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By analyzing existing cross correlation between Shandong Gold Mining and City Development Environment, you can compare the effects of market volatilities on Shandong Gold and City Development 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 Gold with a short position of City Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and City Development.
Diversification Opportunities for Shandong Gold and City Development
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and City is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and City Development Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Development Env and Shandong Gold 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 Gold Mining are associated (or correlated) with City Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Development Env has no effect on the direction of Shandong Gold i.e., Shandong Gold and City Development go up and down completely randomly.
Pair Corralation between Shandong Gold and City Development
Assuming the 90 days trading horizon Shandong Gold Mining is expected to under-perform the City Development. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Gold Mining is 2.41 times less risky than City Development. The stock trades about -0.35 of its potential returns per unit of risk. The City Development Environment is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,255 in City Development Environment on August 28, 2024 and sell it today you would earn a total of 83.00 from holding City Development Environment or generate 6.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Gold Mining vs. City Development Environment
Performance |
| Timeline |
| Shandong Gold Mining |
| City Development Env |
Shandong Gold and City Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and City Development
The main advantage of trading using opposite Shandong Gold and City Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, City Development 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 City Development will offset losses from the drop in City Development's long position.| Shandong Gold vs. Success Electronics | Shandong Gold vs. Sichuan Teway Food | Shandong Gold vs. Fuzhou Rockchip Electronics | Shandong Gold vs. Techshine Electronics Co |
| City Development vs. Zijin Mining Group | City Development vs. Wanhua Chemical Group | City Development vs. Baoshan Iron Steel | City Development vs. Shandong Gold Mining |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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