Correlation Between Shandong Gold and Long Yuan
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By analyzing existing cross correlation between Shandong Gold Mining and Long Yuan Construction, you can compare the effects of market volatilities on Shandong Gold and Long Yuan 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 Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Gold and Long Yuan.
Diversification Opportunities for Shandong Gold and Long Yuan
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and Long is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Gold Mining and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction 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 Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Shandong Gold i.e., Shandong Gold and Long Yuan go up and down completely randomly.
Pair Corralation between Shandong Gold and Long Yuan
Assuming the 90 days trading horizon Shandong Gold Mining is expected to generate 0.65 times more return on investment than Long Yuan. However, Shandong Gold Mining is 1.54 times less risky than Long Yuan. It trades about 0.03 of its potential returns per unit of risk. Long Yuan Construction is currently generating about 0.0 per unit of risk. If you would invest 2,213 in Shandong Gold Mining on September 4, 2024 and sell it today you would earn a total of 231.00 from holding Shandong Gold Mining or generate 10.44% 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. Long Yuan Construction
Performance |
| Timeline |
| Shandong Gold Mining |
| Long Yuan Construction |
Shandong Gold and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Gold and Long Yuan
The main advantage of trading using opposite Shandong Gold and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Gold position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Shandong Gold vs. Long Yuan Construction | Shandong Gold vs. Allied Machinery Co | Shandong Gold vs. Innovative Medical Management | Shandong Gold vs. Guangdong Advertising Co |
| Long Yuan vs. China Life Insurance | Long Yuan vs. Cinda Securities Co | Long Yuan vs. Piotech Inc A | Long Yuan vs. Dongxing Sec 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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