Correlation Between Shengda Mining and NBTM New
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By analyzing existing cross correlation between Shengda Mining Co and NBTM New Materials, you can compare the effects of market volatilities on Shengda Mining and NBTM New 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 Shengda Mining with a short position of NBTM New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shengda Mining and NBTM New.
Diversification Opportunities for Shengda Mining and NBTM New
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shengda and NBTM is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Shengda Mining Co and NBTM New Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBTM New Materials and Shengda 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 Shengda Mining Co are associated (or correlated) with NBTM New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBTM New Materials has no effect on the direction of Shengda Mining i.e., Shengda Mining and NBTM New go up and down completely randomly.
Pair Corralation between Shengda Mining and NBTM New
Assuming the 90 days trading horizon Shengda Mining is expected to generate 21.97 times less return on investment than NBTM New. But when comparing it to its historical volatility, Shengda Mining Co is 1.06 times less risky than NBTM New. It trades about 0.0 of its potential returns per unit of risk. NBTM New Materials is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,280 in NBTM New Materials on September 26, 2024 and sell it today you would earn a total of 369.00 from holding NBTM New Materials or generate 28.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 99.66% |
Values | Daily Returns |
Shengda Mining Co vs. NBTM New Materials
Performance |
Timeline |
Shengda Mining |
NBTM New Materials |
Shengda Mining and NBTM New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shengda Mining and NBTM New
The main advantage of trading using opposite Shengda Mining and NBTM New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shengda Mining position performs unexpectedly, NBTM New 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 NBTM New will offset losses from the drop in NBTM New's long position.Shengda Mining vs. Zijin Mining Group | Shengda Mining vs. Wanhua Chemical Group | Shengda Mining vs. Baoshan Iron Steel | Shengda Mining vs. Shandong Gold Mining |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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