Correlation Between Shandong Gold and Pengxin International
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By analyzing existing cross correlation between Shandong Gold Mining and Pengxin International Mining, you can compare the effects of market volatilities on Shandong Gold and Pengxin International 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 Pengxin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Pengxin International.
Diversification Opportunities for Shandong Gold and Pengxin International
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Pengxin is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Pengxin International Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengxin International 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 Pengxin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengxin International has no effect on the direction of Shandong Gold i.e., Shandong Gold and Pengxin International go up and down completely randomly.
Pair Corralation between Shandong Gold and Pengxin International
Assuming the 90 days trading horizon Shandong Gold Mining is expected to under-perform the Pengxin International. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Gold Mining is 2.44 times less risky than Pengxin International. The stock trades about -0.39 of its potential returns per unit of risk. The Pengxin International Mining is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 321.00 in Pengxin International Mining on August 29, 2024 and sell it today you would lose (1.00) from holding Pengxin International Mining or give up 0.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Gold Mining vs. Pengxin International Mining
Performance |
| Timeline |
| Shandong Gold Mining |
| Pengxin International |
Shandong Gold and Pengxin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Pengxin International
The main advantage of trading using opposite Shandong Gold and Pengxin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Pengxin International 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 Pengxin International will offset losses from the drop in Pengxin International'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 |
| Pengxin International vs. Wanhua Chemical Group | Pengxin International vs. Shandong Gold Mining | Pengxin International vs. Rongsheng Petrochemical Co | Pengxin International vs. Inner Mongolia BaoTou |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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