Correlation Between Maoming Petro and Tongling Nonferrous
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By analyzing existing cross correlation between Maoming Petro Chemical Shihua and Tongling Nonferrous Metals, you can compare the effects of market volatilities on Maoming Petro and Tongling Nonferrous 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 Maoming Petro with a short position of Tongling Nonferrous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maoming Petro and Tongling Nonferrous.
Diversification Opportunities for Maoming Petro and Tongling Nonferrous
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Maoming and Tongling is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Maoming Petro Chemical Shihua and Tongling Nonferrous Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongling Nonferrous and Maoming Petro 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 Maoming Petro Chemical Shihua are associated (or correlated) with Tongling Nonferrous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongling Nonferrous has no effect on the direction of Maoming Petro i.e., Maoming Petro and Tongling Nonferrous go up and down completely randomly.
Pair Corralation between Maoming Petro and Tongling Nonferrous
Assuming the 90 days trading horizon Maoming Petro Chemical Shihua is expected to under-perform the Tongling Nonferrous. In addition to that, Maoming Petro is 1.2 times more volatile than Tongling Nonferrous Metals. It trades about -0.02 of its total potential returns per unit of risk. Tongling Nonferrous Metals is currently generating about 0.01 per unit of volatility. If you would invest 329.00 in Tongling Nonferrous Metals on October 26, 2024 and sell it today you would lose (2.00) from holding Tongling Nonferrous Metals or give up 0.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maoming Petro Chemical Shihua vs. Tongling Nonferrous Metals
Performance |
| Timeline |
| Maoming Petro Chemical |
| Tongling Nonferrous |
Maoming Petro and Tongling Nonferrous Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maoming Petro and Tongling Nonferrous
The main advantage of trading using opposite Maoming Petro and Tongling Nonferrous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maoming Petro position performs unexpectedly, Tongling Nonferrous 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 Tongling Nonferrous will offset losses from the drop in Tongling Nonferrous' long position.| Maoming Petro vs. Fiberhome Telecommunication Technologies | Maoming Petro vs. Jinhui Liquor Co | Maoming Petro vs. Jiangsu Financial Leasing | Maoming Petro vs. Caihong Display Devices |
| Tongling Nonferrous vs. FSPG Hi Tech Co | Tongling Nonferrous vs. Sichuan Jinshi Technology | Tongling Nonferrous vs. Gansu Huangtai Wine marketing | Tongling Nonferrous vs. Kuang Chi Technologies |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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