Correlation Between Tibet Huayu and Shaanxi Meineng
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By analyzing existing cross correlation between Tibet Huayu Mining and Shaanxi Meineng Clean, you can compare the effects of market volatilities on Tibet Huayu and Shaanxi Meineng 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 Tibet Huayu with a short position of Shaanxi Meineng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tibet Huayu and Shaanxi Meineng.
Diversification Opportunities for Tibet Huayu and Shaanxi Meineng
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tibet and Shaanxi is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Tibet Huayu Mining and Shaanxi Meineng Clean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Meineng Clean and Tibet Huayu 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 Tibet Huayu Mining are associated (or correlated) with Shaanxi Meineng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Meineng Clean has no effect on the direction of Tibet Huayu i.e., Tibet Huayu and Shaanxi Meineng go up and down completely randomly.
Pair Corralation between Tibet Huayu and Shaanxi Meineng
Assuming the 90 days trading horizon Tibet Huayu is expected to generate 1.74 times less return on investment than Shaanxi Meineng. In addition to that, Tibet Huayu is 1.8 times more volatile than Shaanxi Meineng Clean. It trades about 0.02 of its total potential returns per unit of risk. Shaanxi Meineng Clean is currently generating about 0.07 per unit of volatility. If you would invest 1,182 in Shaanxi Meineng Clean on September 3, 2024 and sell it today you would earn a total of 200.00 from holding Shaanxi Meineng Clean or generate 16.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tibet Huayu Mining vs. Shaanxi Meineng Clean
Performance |
| Timeline |
| Tibet Huayu Mining |
| Shaanxi Meineng Clean |
Tibet Huayu and Shaanxi Meineng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tibet Huayu and Shaanxi Meineng
The main advantage of trading using opposite Tibet Huayu and Shaanxi Meineng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tibet Huayu position performs unexpectedly, Shaanxi Meineng 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 Shaanxi Meineng will offset losses from the drop in Shaanxi Meineng's long position.| Tibet Huayu vs. Zijin Mining Group | Tibet Huayu vs. Baoshan Iron Steel | Tibet Huayu vs. Hoshine Silicon Ind |
| Shaanxi Meineng vs. Industrial and Commercial | Shaanxi Meineng vs. Agricultural Bank of | Shaanxi Meineng vs. China Construction Bank | Shaanxi Meineng vs. Bank of China |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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