Correlation Between Maoming Petro and Kuang Chi
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By analyzing existing cross correlation between Maoming Petro Chemical Shihua and Kuang Chi Technologies, you can compare the effects of market volatilities on Maoming Petro and Kuang Chi 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 Kuang Chi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maoming Petro and Kuang Chi.
Diversification Opportunities for Maoming Petro and Kuang Chi
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Maoming and Kuang is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Maoming Petro Chemical Shihua and Kuang Chi Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuang Chi Technologies 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 Kuang Chi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuang Chi Technologies has no effect on the direction of Maoming Petro i.e., Maoming Petro and Kuang Chi go up and down completely randomly.
Pair Corralation between Maoming Petro and Kuang Chi
Assuming the 90 days trading horizon Maoming Petro Chemical Shihua is expected to under-perform the Kuang Chi. But the stock apears to be less risky and, when comparing its historical volatility, Maoming Petro Chemical Shihua is 1.28 times less risky than Kuang Chi. The stock trades about -0.03 of its potential returns per unit of risk. The Kuang Chi Technologies is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,811 in Kuang Chi Technologies on October 14, 2024 and sell it today you would earn a total of 2,219 from holding Kuang Chi Technologies or generate 122.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maoming Petro Chemical Shihua vs. Kuang Chi Technologies
Performance |
| Timeline |
| Maoming Petro Chemical |
| Kuang Chi Technologies |
Maoming Petro and Kuang Chi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maoming Petro and Kuang Chi
The main advantage of trading using opposite Maoming Petro and Kuang Chi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maoming Petro position performs unexpectedly, Kuang Chi 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 Kuang Chi will offset losses from the drop in Kuang Chi's long position.| Maoming Petro vs. Guangzhou Haige Communications | Maoming Petro vs. Fuda Alloy Materials | Maoming Petro vs. Tongyu Communication | Maoming Petro vs. China Building Material |
| Kuang Chi vs. Ningxia Younglight Chemicals | Kuang Chi vs. Yingde Greatchem Chemicals | Kuang Chi vs. Maoming Petro Chemical Shihua | Kuang Chi vs. Liaoning Dingjide Petrochemical |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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