Correlation Between Shandong Gold and Shandong Sino-Agri
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By analyzing existing cross correlation between Shandong Gold Mining and Shandong Sino Agri United, you can compare the effects of market volatilities on Shandong Gold and Shandong Sino-Agri 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 Shandong Sino-Agri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Shandong Sino-Agri.
Diversification Opportunities for Shandong Gold and Shandong Sino-Agri
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Shandong is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Shandong Sino Agri United in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Sino Agri 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 Shandong Sino-Agri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Sino Agri has no effect on the direction of Shandong Gold i.e., Shandong Gold and Shandong Sino-Agri go up and down completely randomly.
Pair Corralation between Shandong Gold and Shandong Sino-Agri
Assuming the 90 days trading horizon Shandong Gold Mining is expected to under-perform the Shandong Sino-Agri. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Gold Mining is 2.93 times less risky than Shandong Sino-Agri. The stock trades about -0.25 of its potential returns per unit of risk. The Shandong Sino Agri United is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 1,409 in Shandong Sino Agri United on September 1, 2024 and sell it today you would earn a total of 388.00 from holding Shandong Sino Agri United or generate 27.54% 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. Shandong Sino Agri United
Performance |
| Timeline |
| Shandong Gold Mining |
| Shandong Sino Agri |
Shandong Gold and Shandong Sino-Agri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Shandong Sino-Agri
The main advantage of trading using opposite Shandong Gold and Shandong Sino-Agri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Shandong Sino-Agri 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 Shandong Sino-Agri will offset losses from the drop in Shandong Sino-Agri's long position.| Shandong Gold vs. Dhc Software Co | Shandong Gold vs. Western Superconducting Tech | Shandong Gold vs. Guangdong Jingyi Metal | Shandong Gold vs. Guocheng Mining Co |
| Shandong Sino-Agri vs. Zijin Mining Group | Shandong Sino-Agri vs. Wanhua Chemical Group | Shandong Sino-Agri vs. Baoshan Iron Steel | Shandong Sino-Agri 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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