Correlation Between Ningbo Ligong and China Petroleum
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By analyzing existing cross correlation between Ningbo Ligong Online and China Petroleum Chemical, you can compare the effects of market volatilities on Ningbo Ligong 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 Ningbo Ligong with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Ligong and China Petroleum.
Diversification Opportunities for Ningbo Ligong and China Petroleum
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ningbo and China is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Ligong Online 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 Ningbo Ligong 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 Ningbo Ligong Online 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 Ningbo Ligong i.e., Ningbo Ligong and China Petroleum go up and down completely randomly.
Pair Corralation between Ningbo Ligong and China Petroleum
Assuming the 90 days trading horizon Ningbo Ligong Online is expected to under-perform the China Petroleum. In addition to that, Ningbo Ligong is 2.15 times more volatile than China Petroleum Chemical. It trades about -0.11 of its total potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.23 per unit of volatility. If you would invest 618.00 in China Petroleum Chemical on September 13, 2024 and sell it today you would earn a total of 26.00 from holding China Petroleum Chemical or generate 4.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Ligong Online vs. China Petroleum Chemical
Performance |
| Timeline |
| Ningbo Ligong Online |
| China Petroleum Chemical |
Ningbo Ligong and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Ligong and China Petroleum
The main advantage of trading using opposite Ningbo Ligong and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Ligong 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.| Ningbo Ligong vs. China Petroleum Chemical | Ningbo Ligong vs. PetroChina Co Ltd | Ningbo Ligong vs. China State Construction | Ningbo Ligong vs. China Railway Group |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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