Correlation Between Shanghai Shuixing and Shandong Mining
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By analyzing existing cross correlation between Shanghai Shuixing Home and Shandong Mining Machinery, you can compare the effects of market volatilities on Shanghai Shuixing and Shandong Mining 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 Shanghai Shuixing with a short position of Shandong Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Shuixing and Shandong Mining.
Diversification Opportunities for Shanghai Shuixing and Shandong Mining
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Shandong is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Shuixing Home and Shandong Mining Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Mining Machinery and Shanghai Shuixing 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 Shanghai Shuixing Home are associated (or correlated) with Shandong Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Mining Machinery has no effect on the direction of Shanghai Shuixing i.e., Shanghai Shuixing and Shandong Mining go up and down completely randomly.
Pair Corralation between Shanghai Shuixing and Shandong Mining
Assuming the 90 days trading horizon Shanghai Shuixing is expected to generate 4.23 times less return on investment than Shandong Mining. But when comparing it to its historical volatility, Shanghai Shuixing Home is 1.66 times less risky than Shandong Mining. It trades about 0.05 of its potential returns per unit of risk. Shandong Mining Machinery is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 276.00 in Shandong Mining Machinery on October 26, 2024 and sell it today you would earn a total of 108.00 from holding Shandong Mining Machinery or generate 39.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Shuixing Home vs. Shandong Mining Machinery
Performance |
| Timeline |
| Shanghai Shuixing Home |
| Shandong Mining Machinery |
Shanghai Shuixing and Shandong Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Shuixing and Shandong Mining
The main advantage of trading using opposite Shanghai Shuixing and Shandong Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Shuixing position performs unexpectedly, Shandong Mining 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 Shandong Mining will offset losses from the drop in Shandong Mining's long position.| Shanghai Shuixing vs. Shengda Mining Co | Shanghai Shuixing vs. Xinjiang Baodi Mining | Shanghai Shuixing vs. Hainan Mining Co | Shanghai Shuixing vs. Western Metal Materials |
| Shandong Mining vs. Dareway Software Co | Shandong Mining vs. State Grid InformationCommunication | Shandong Mining vs. China National Software | Shandong Mining vs. Anhui Jianghuai Automobile |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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