Correlation Between Rongsheng Petrochemical and Zhejiang Satellite
Specify exactly 2 symbols:
By analyzing existing cross correlation between Rongsheng Petrochemical Co and Zhejiang Satellite Petrochemical, you can compare the effects of market volatilities on Rongsheng Petrochemical and Zhejiang Satellite 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 Rongsheng Petrochemical with a short position of Zhejiang Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rongsheng Petrochemical and Zhejiang Satellite.
Diversification Opportunities for Rongsheng Petrochemical and Zhejiang Satellite
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rongsheng and Zhejiang is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Rongsheng Petrochemical Co and Zhejiang Satellite Petrochemic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Satellite and Rongsheng Petrochemical 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 Rongsheng Petrochemical Co are associated (or correlated) with Zhejiang Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Satellite has no effect on the direction of Rongsheng Petrochemical i.e., Rongsheng Petrochemical and Zhejiang Satellite go up and down completely randomly.
Pair Corralation between Rongsheng Petrochemical and Zhejiang Satellite
Assuming the 90 days trading horizon Rongsheng Petrochemical Co is expected to generate 1.13 times more return on investment than Zhejiang Satellite. However, Rongsheng Petrochemical is 1.13 times more volatile than Zhejiang Satellite Petrochemical. It trades about 0.01 of its potential returns per unit of risk. Zhejiang Satellite Petrochemical is currently generating about -0.27 per unit of risk. If you would invest 952.00 in Rongsheng Petrochemical Co on September 2, 2024 and sell it today you would earn a total of 2.00 from holding Rongsheng Petrochemical Co or generate 0.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rongsheng Petrochemical Co vs. Zhejiang Satellite Petrochemic
Performance |
| Timeline |
| Rongsheng Petrochemical |
| Zhejiang Satellite |
Rongsheng Petrochemical and Zhejiang Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rongsheng Petrochemical and Zhejiang Satellite
The main advantage of trading using opposite Rongsheng Petrochemical and Zhejiang Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rongsheng Petrochemical position performs unexpectedly, Zhejiang Satellite 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 Zhejiang Satellite will offset losses from the drop in Zhejiang Satellite's long position.| Rongsheng Petrochemical vs. Zijin Mining Group | Rongsheng Petrochemical vs. Wanhua Chemical Group | Rongsheng Petrochemical vs. Baoshan Iron Steel | Rongsheng Petrochemical vs. Shandong Gold Mining |
| Zhejiang Satellite vs. Mengtian Home Group | Zhejiang Satellite vs. Luolai Home Textile | Zhejiang Satellite vs. Xilinmen Furniture Co | Zhejiang Satellite vs. AUPU Home Style |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |