Correlation Between Maoming Petro and Muyuan Foodstuff
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By analyzing existing cross correlation between Maoming Petro Chemical Shihua and Muyuan Foodstuff Co, you can compare the effects of market volatilities on Maoming Petro and Muyuan Foodstuff 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 Muyuan Foodstuff. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maoming Petro and Muyuan Foodstuff.
Diversification Opportunities for Maoming Petro and Muyuan Foodstuff
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Maoming and Muyuan is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Maoming Petro Chemical Shihua and Muyuan Foodstuff Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Muyuan Foodstuff 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 Muyuan Foodstuff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Muyuan Foodstuff has no effect on the direction of Maoming Petro i.e., Maoming Petro and Muyuan Foodstuff go up and down completely randomly.
Pair Corralation between Maoming Petro and Muyuan Foodstuff
Assuming the 90 days trading horizon Maoming Petro Chemical Shihua is expected to generate 1.79 times more return on investment than Muyuan Foodstuff. However, Maoming Petro is 1.79 times more volatile than Muyuan Foodstuff Co. It trades about -0.07 of its potential returns per unit of risk. Muyuan Foodstuff Co is currently generating about -0.17 per unit of risk. If you would invest 384.00 in Maoming Petro Chemical Shihua on October 22, 2024 and sell it today you would lose (13.00) from holding Maoming Petro Chemical Shihua or give up 3.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maoming Petro Chemical Shihua vs. Muyuan Foodstuff Co
Performance |
| Timeline |
| Maoming Petro Chemical |
| Muyuan Foodstuff |
Maoming Petro and Muyuan Foodstuff Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maoming Petro and Muyuan Foodstuff
The main advantage of trading using opposite Maoming Petro and Muyuan Foodstuff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maoming Petro position performs unexpectedly, Muyuan Foodstuff 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 Muyuan Foodstuff will offset losses from the drop in Muyuan Foodstuff's long position.| Maoming Petro vs. Cultural Investment Holdings | Maoming Petro vs. Suzhou Douson Drilling | Maoming Petro vs. Harvest Fund Management | Maoming Petro vs. Harbin Hatou Investment |
| Muyuan Foodstuff vs. Guizhou Chanhen Chemical | Muyuan Foodstuff vs. Xilong Chemical Co | Muyuan Foodstuff vs. Maoming Petro Chemical Shihua | Muyuan Foodstuff vs. Yangmei Chemical 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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