Correlation Between Shandong Gold and Xiamen Hexing
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By analyzing existing cross correlation between Shandong Gold Mining and Xiamen Hexing Packaging, you can compare the effects of market volatilities on Shandong Gold and Xiamen Hexing 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 Xiamen Hexing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Xiamen Hexing.
Diversification Opportunities for Shandong Gold and Xiamen Hexing
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Xiamen is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Xiamen Hexing Packaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Hexing Packaging 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 Xiamen Hexing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Hexing Packaging has no effect on the direction of Shandong Gold i.e., Shandong Gold and Xiamen Hexing go up and down completely randomly.
Pair Corralation between Shandong Gold and Xiamen Hexing
Assuming the 90 days trading horizon Shandong Gold Mining is expected to generate 1.07 times more return on investment than Xiamen Hexing. However, Shandong Gold is 1.07 times more volatile than Xiamen Hexing Packaging. It trades about 0.04 of its potential returns per unit of risk. Xiamen Hexing Packaging is currently generating about 0.02 per unit of risk. If you would invest 1,922 in Shandong Gold Mining on September 5, 2024 and sell it today you would earn a total of 522.00 from holding Shandong Gold Mining or generate 27.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Shandong Gold Mining vs. Xiamen Hexing Packaging
Performance |
| Timeline |
| Shandong Gold Mining |
| Xiamen Hexing Packaging |
Shandong Gold and Xiamen Hexing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Xiamen Hexing
The main advantage of trading using opposite Shandong Gold and Xiamen Hexing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Xiamen Hexing 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 Xiamen Hexing will offset losses from the drop in Xiamen Hexing's long position.| Shandong Gold vs. Leyard Optoelectronic | Shandong Gold vs. FSPG Hi Tech Co | Shandong Gold vs. Eastern Communications Co | Shandong Gold vs. Fujian Newland Computer |
| Xiamen Hexing vs. Nexchip Semiconductor Corp | Xiamen Hexing vs. Offshore Oil Engineering | Xiamen Hexing vs. Jahen Household Products | Xiamen Hexing vs. Marssenger Kitchenware Co |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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