Correlation Between Shandong Gold and Hubei Forbon
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By analyzing existing cross correlation between Shandong Gold Mining and Hubei Forbon Technology, you can compare the effects of market volatilities on Shandong Gold and Hubei Forbon 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 Hubei Forbon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Hubei Forbon.
Diversification Opportunities for Shandong Gold and Hubei Forbon
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Hubei is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Hubei Forbon Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Forbon Technology 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 Hubei Forbon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Forbon Technology has no effect on the direction of Shandong Gold i.e., Shandong Gold and Hubei Forbon go up and down completely randomly.
Pair Corralation between Shandong Gold and Hubei Forbon
Assuming the 90 days trading horizon Shandong Gold Mining is expected to generate 0.67 times more return on investment than Hubei Forbon. However, Shandong Gold Mining is 1.49 times less risky than Hubei Forbon. It trades about 0.21 of its potential returns per unit of risk. Hubei Forbon Technology is currently generating about 0.05 per unit of risk. If you would invest 2,307 in Shandong Gold Mining on October 26, 2024 and sell it today you would earn a total of 174.00 from holding Shandong Gold Mining or generate 7.54% 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. Hubei Forbon Technology
Performance |
| Timeline |
| Shandong Gold Mining |
| Hubei Forbon Technology |
Shandong Gold and Hubei Forbon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Hubei Forbon
The main advantage of trading using opposite Shandong Gold and Hubei Forbon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Hubei Forbon 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 Hubei Forbon will offset losses from the drop in Hubei Forbon's long position.| Shandong Gold vs. Easyhome New Retail | Shandong Gold vs. AUPU Home Style | Shandong Gold vs. Ningbo Fujia Industrial | Shandong Gold vs. Xinjiang Baodi Mining |
| Hubei Forbon vs. Zijin Mining Group | Hubei Forbon vs. Wanhua Chemical Group | Hubei Forbon vs. Baoshan Iron Steel | Hubei Forbon 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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