Correlation Between Lutian Machinery and Shandong Mining
Specify exactly 2 symbols:
By analyzing existing cross correlation between Lutian Machinery Co and Shandong Mining Machinery, you can compare the effects of market volatilities on Lutian Machinery 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 Lutian Machinery with a short position of Shandong Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Shandong Mining.
Diversification Opportunities for Lutian Machinery and Shandong Mining
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lutian and Shandong is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co 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 Lutian Machinery 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 Lutian Machinery Co 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 Lutian Machinery i.e., Lutian Machinery and Shandong Mining go up and down completely randomly.
Pair Corralation between Lutian Machinery and Shandong Mining
Assuming the 90 days trading horizon Lutian Machinery is expected to generate 17.05 times less return on investment than Shandong Mining. But when comparing it to its historical volatility, Lutian Machinery Co is 3.83 times less risky than Shandong Mining. It trades about 0.09 of its potential returns per unit of risk. Shandong Mining Machinery is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 294.00 in Shandong Mining Machinery on September 13, 2024 and sell it today you would earn a total of 214.00 from holding Shandong Mining Machinery or generate 72.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lutian Machinery Co vs. Shandong Mining Machinery
Performance |
| Timeline |
| Lutian Machinery |
| Shandong Mining Machinery |
Lutian Machinery and Shandong Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Shandong Mining
The main advantage of trading using opposite Lutian Machinery and Shandong Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery 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.| Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. Kweichow Moutai Co | Lutian Machinery vs. Agricultural Bank of | Lutian Machinery vs. China Mobile Limited |
| Shandong Mining vs. China Petroleum Chemical | Shandong Mining vs. PetroChina Co Ltd | Shandong Mining vs. China State Construction | Shandong Mining vs. China Railway Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| CEOs Directory Screen CEOs from public companies around the world |