Correlation Between Western Mining and Shaanxi Broadcast
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By analyzing existing cross correlation between Western Mining Co and Shaanxi Broadcast TV, you can compare the effects of market volatilities on Western Mining and Shaanxi Broadcast 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 Western Mining with a short position of Shaanxi Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Mining and Shaanxi Broadcast.
Diversification Opportunities for Western Mining and Shaanxi Broadcast
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Western and Shaanxi is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Western Mining Co and Shaanxi Broadcast TV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Broadcast and Western Mining 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 Western Mining Co are associated (or correlated) with Shaanxi Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Broadcast has no effect on the direction of Western Mining i.e., Western Mining and Shaanxi Broadcast go up and down completely randomly.
Pair Corralation between Western Mining and Shaanxi Broadcast
Assuming the 90 days trading horizon Western Mining Co is expected to under-perform the Shaanxi Broadcast. But the stock apears to be less risky and, when comparing its historical volatility, Western Mining Co is 1.61 times less risky than Shaanxi Broadcast. The stock trades about -0.15 of its potential returns per unit of risk. The Shaanxi Broadcast TV is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 280.00 in Shaanxi Broadcast TV on September 14, 2024 and sell it today you would earn a total of 29.00 from holding Shaanxi Broadcast TV or generate 10.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Mining Co vs. Shaanxi Broadcast TV
Performance |
| Timeline |
| Western Mining |
| Shaanxi Broadcast |
Western Mining and Shaanxi Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Mining and Shaanxi Broadcast
The main advantage of trading using opposite Western Mining and Shaanxi Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Mining position performs unexpectedly, Shaanxi Broadcast 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 Broadcast will offset losses from the drop in Shaanxi Broadcast's long position.| Western Mining vs. Zijin Mining Group | Western Mining vs. Wanhua Chemical Group | Western Mining vs. Baoshan Iron Steel | Western Mining vs. Shandong Gold Mining |
| Shaanxi Broadcast vs. Lutian Machinery Co | Shaanxi Broadcast vs. PetroChina Co Ltd | Shaanxi Broadcast vs. Bank of China | Shaanxi Broadcast vs. China Citic Bank |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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