Correlation Between Shandong Polymer and China Petroleum
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By analyzing existing cross correlation between Shandong Polymer Biochemicals and China Petroleum Chemical, you can compare the effects of market volatilities on Shandong Polymer 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 Shandong Polymer with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Polymer and China Petroleum.
Diversification Opportunities for Shandong Polymer and China Petroleum
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shandong and China is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Polymer Biochemicals 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 Shandong Polymer 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 Shandong Polymer Biochemicals 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 Shandong Polymer i.e., Shandong Polymer and China Petroleum go up and down completely randomly.
Pair Corralation between Shandong Polymer and China Petroleum
Assuming the 90 days trading horizon Shandong Polymer Biochemicals is expected to generate 4.43 times more return on investment than China Petroleum. However, Shandong Polymer is 4.43 times more volatile than China Petroleum Chemical. It trades about 0.11 of its potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.13 per unit of risk. If you would invest 421.00 in Shandong Polymer Biochemicals on August 30, 2024 and sell it today you would earn a total of 35.00 from holding Shandong Polymer Biochemicals or generate 8.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Polymer Biochemicals vs. China Petroleum Chemical
Performance |
| Timeline |
| Shandong Polymer Bio |
| China Petroleum Chemical |
Shandong Polymer and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Polymer and China Petroleum
The main advantage of trading using opposite Shandong Polymer and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Polymer 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.| Shandong Polymer vs. Hubeiyichang Transportation Group | Shandong Polymer vs. Ping An Insurance | Shandong Polymer vs. Shuhua Sports Co | Shandong Polymer vs. Chengdu Spaceon Electronics |
| China Petroleum vs. Anhui Huilong Agricultural | China Petroleum vs. Chinese Universe Publishing | China Petroleum vs. Shanghai Action Education | China Petroleum vs. Time Publishing and |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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