Correlation Between Maoming Petro and Longxing Chemical
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By analyzing existing cross correlation between Maoming Petro Chemical Shihua and Longxing Chemical Stock, you can compare the effects of market volatilities on Maoming Petro and Longxing Chemical 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 Longxing Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maoming Petro and Longxing Chemical.
Diversification Opportunities for Maoming Petro and Longxing Chemical
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Maoming and Longxing is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Maoming Petro Chemical Shihua and Longxing Chemical Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longxing Chemical Stock 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 Longxing Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longxing Chemical Stock has no effect on the direction of Maoming Petro i.e., Maoming Petro and Longxing Chemical go up and down completely randomly.
Pair Corralation between Maoming Petro and Longxing Chemical
Assuming the 90 days trading horizon Maoming Petro Chemical Shihua is expected to under-perform the Longxing Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Maoming Petro Chemical Shihua is 1.01 times less risky than Longxing Chemical. The stock trades about -0.02 of its potential returns per unit of risk. The Longxing Chemical Stock is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 515.00 in Longxing Chemical Stock on September 3, 2024 and sell it today you would earn a total of 53.00 from holding Longxing Chemical Stock or generate 10.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maoming Petro Chemical Shihua vs. Longxing Chemical Stock
Performance |
| Timeline |
| Maoming Petro Chemical |
| Longxing Chemical Stock |
Maoming Petro and Longxing Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maoming Petro and Longxing Chemical
The main advantage of trading using opposite Maoming Petro and Longxing Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maoming Petro position performs unexpectedly, Longxing Chemical 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 Longxing Chemical will offset losses from the drop in Longxing Chemical's long position.| Maoming Petro vs. Zijin Mining Group | Maoming Petro vs. Baoshan Iron Steel | Maoming Petro vs. Hoshine Silicon Ind |
| Longxing Chemical vs. Guangdong Liantai Environmental | Longxing Chemical vs. Hengli Industrial Development | Longxing Chemical vs. Lingyuan Iron Steel | Longxing Chemical vs. Dongjiang Environmental Co |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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