Correlation Between Zhongshan Broad and China Petroleum
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By analyzing existing cross correlation between Zhongshan Broad Ocean Motor and China Petroleum Chemical, you can compare the effects of market volatilities on Zhongshan Broad and China Petroleum 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 Zhongshan Broad with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhongshan Broad and China Petroleum.
Diversification Opportunities for Zhongshan Broad and China Petroleum
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Zhongshan and China is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Zhongshan Broad Ocean Motor and China Petroleum Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Petroleum Chemical and Zhongshan Broad 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 Zhongshan Broad Ocean Motor are associated (or correlated) with China Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Petroleum Chemical has no effect on the direction of Zhongshan Broad i.e., Zhongshan Broad and China Petroleum go up and down completely randomly.
Pair Corralation between Zhongshan Broad and China Petroleum
Assuming the 90 days trading horizon Zhongshan Broad is expected to generate 1.87 times less return on investment than China Petroleum. In addition to that, Zhongshan Broad is 2.22 times more volatile than China Petroleum Chemical. It trades about 0.05 of its total potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.2 per unit of volatility. If you would invest 624.00 in China Petroleum Chemical on September 14, 2024 and sell it today you would earn a total of 22.00 from holding China Petroleum Chemical or generate 3.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhongshan Broad Ocean Motor vs. China Petroleum Chemical
Performance |
| Timeline |
| Zhongshan Broad Ocean |
| China Petroleum Chemical |
Zhongshan Broad and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhongshan Broad and China Petroleum
The main advantage of trading using opposite Zhongshan Broad and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhongshan Broad position performs unexpectedly, China Petroleum 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 China Petroleum will offset losses from the drop in China Petroleum's long position.| Zhongshan Broad vs. Ming Yang Smart | Zhongshan Broad vs. 159681 | Zhongshan Broad vs. 159005 | Zhongshan Broad vs. Loctek Ergonomic Technology |
| China Petroleum vs. Qilu Bank Co | China Petroleum vs. Postal Savings Bank | China Petroleum vs. HeNan Splendor Science | China Petroleum vs. Western Mining 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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