Correlation Between Shandong Gold and Liuzhou Chemical
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By analyzing existing cross correlation between Shandong Gold Mining and Liuzhou Chemical Industry, you can compare the effects of market volatilities on Shandong Gold and Liuzhou Chemical 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 Liuzhou Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Liuzhou Chemical.
Diversification Opportunities for Shandong Gold and Liuzhou Chemical
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Liuzhou is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Liuzhou Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liuzhou Chemical Industry 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 Liuzhou Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liuzhou Chemical Industry has no effect on the direction of Shandong Gold i.e., Shandong Gold and Liuzhou Chemical go up and down completely randomly.
Pair Corralation between Shandong Gold and Liuzhou Chemical
Assuming the 90 days trading horizon Shandong Gold Mining is expected to generate 0.82 times more return on investment than Liuzhou Chemical. However, Shandong Gold Mining is 1.22 times less risky than Liuzhou Chemical. It trades about 0.04 of its potential returns per unit of risk. Liuzhou Chemical Industry is currently generating about 0.0 per unit of risk. If you would invest 1,915 in Shandong Gold Mining on August 28, 2024 and sell it today you would earn a total of 551.00 from holding Shandong Gold Mining or generate 28.77% 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. Liuzhou Chemical Industry
Performance |
| Timeline |
| Shandong Gold Mining |
| Liuzhou Chemical Industry |
Shandong Gold and Liuzhou Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Liuzhou Chemical
The main advantage of trading using opposite Shandong Gold and Liuzhou Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Liuzhou Chemical 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 Liuzhou Chemical will offset losses from the drop in Liuzhou Chemical'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 |
| Liuzhou Chemical vs. Zijin Mining Group | Liuzhou Chemical vs. Wanhua Chemical Group | Liuzhou Chemical vs. Baoshan Iron Steel | Liuzhou Chemical 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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