Correlation Between Shandong Gold and Ningxia Building
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By analyzing existing cross correlation between Shandong Gold Mining and Ningxia Building Materials, you can compare the effects of market volatilities on Shandong Gold and Ningxia Building 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 Ningxia Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Ningxia Building.
Diversification Opportunities for Shandong Gold and Ningxia Building
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shandong and Ningxia is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Ningxia Building Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Building Mat 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 Ningxia Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Building Mat has no effect on the direction of Shandong Gold i.e., Shandong Gold and Ningxia Building go up and down completely randomly.
Pair Corralation between Shandong Gold and Ningxia Building
Assuming the 90 days trading horizon Shandong Gold Mining is expected to generate 0.8 times more return on investment than Ningxia Building. However, Shandong Gold Mining is 1.25 times less risky than Ningxia Building. It trades about 0.19 of its potential returns per unit of risk. Ningxia Building Materials is currently generating about -0.2 per unit of risk. If you would invest 2,316 in Shandong Gold Mining on October 28, 2024 and sell it today you would earn a total of 159.00 from holding Shandong Gold Mining or generate 6.87% 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. Ningxia Building Materials
Performance |
| Timeline |
| Shandong Gold Mining |
| Ningxia Building Mat |
Shandong Gold and Ningxia Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Ningxia Building
The main advantage of trading using opposite Shandong Gold and Ningxia Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Ningxia Building 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 Ningxia Building will offset losses from the drop in Ningxia Building's long position.| Shandong Gold vs. Easyhome New Retail | Shandong Gold vs. Shanghai Rongtai Health | Shandong Gold vs. Bus Online Co | Shandong Gold vs. Shandong Sinoglory Health |
| Ningxia Building vs. Zijin Mining Group | Ningxia Building vs. Wanhua Chemical Group | Ningxia Building vs. Baoshan Iron Steel | Ningxia Building 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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