Correlation Between Shandong Gold and Ningbo Homelink
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By analyzing existing cross correlation between Shandong Gold Mining and Ningbo Homelink Eco iTech, you can compare the effects of market volatilities on Shandong Gold and Ningbo Homelink 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 Ningbo Homelink. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Ningbo Homelink.
Diversification Opportunities for Shandong Gold and Ningbo Homelink
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Ningbo is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Ningbo Homelink Eco iTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Homelink Eco 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 Ningbo Homelink. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Homelink Eco has no effect on the direction of Shandong Gold i.e., Shandong Gold and Ningbo Homelink go up and down completely randomly.
Pair Corralation between Shandong Gold and Ningbo Homelink
Assuming the 90 days trading horizon Shandong Gold Mining is expected to under-perform the Ningbo Homelink. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Gold Mining is 1.31 times less risky than Ningbo Homelink. The stock trades about -0.06 of its potential returns per unit of risk. The Ningbo Homelink Eco iTech is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,596 in Ningbo Homelink Eco iTech on September 26, 2024 and sell it today you would lose (2.00) from holding Ningbo Homelink Eco iTech or give up 0.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Gold Mining vs. Ningbo Homelink Eco iTech
Performance |
| Timeline |
| Shandong Gold Mining |
| Ningbo Homelink Eco |
Shandong Gold and Ningbo Homelink Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Ningbo Homelink
The main advantage of trading using opposite Shandong Gold and Ningbo Homelink positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Ningbo Homelink 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 Ningbo Homelink will offset losses from the drop in Ningbo Homelink's long position.| Shandong Gold vs. Wanhua Chemical Group | Shandong Gold vs. Rongsheng Petrochemical Co | Shandong Gold vs. Inner Mongolia BaoTou | Shandong Gold vs. Jiangxi Ganfeng Lithium |
| Ningbo Homelink vs. Zijin Mining Group | Ningbo Homelink vs. Baoshan Iron Steel | Ningbo Homelink vs. Shandong Gold Mining | Ningbo Homelink vs. Rongsheng Petrochemical 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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