Correlation Between Rongsheng Petrochemical and Ningxia Baofeng
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By analyzing existing cross correlation between Rongsheng Petrochemical Co and Ningxia Baofeng Energy, you can compare the effects of market volatilities on Rongsheng Petrochemical and Ningxia Baofeng 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 Ningxia Baofeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rongsheng Petrochemical and Ningxia Baofeng.
Diversification Opportunities for Rongsheng Petrochemical and Ningxia Baofeng
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rongsheng and Ningxia is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Rongsheng Petrochemical Co and Ningxia Baofeng Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Baofeng Energy 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 Ningxia Baofeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Baofeng Energy has no effect on the direction of Rongsheng Petrochemical i.e., Rongsheng Petrochemical and Ningxia Baofeng go up and down completely randomly.
Pair Corralation between Rongsheng Petrochemical and Ningxia Baofeng
Assuming the 90 days trading horizon Rongsheng Petrochemical Co is expected to generate 0.49 times more return on investment than Ningxia Baofeng. However, Rongsheng Petrochemical Co is 2.06 times less risky than Ningxia Baofeng. It trades about -0.11 of its potential returns per unit of risk. Ningxia Baofeng Energy is currently generating about -0.26 per unit of risk. If you would invest 883.00 in Rongsheng Petrochemical Co on November 28, 2024 and sell it today you would lose (13.00) from holding Rongsheng Petrochemical Co or give up 1.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Rongsheng Petrochemical Co vs. Ningxia Baofeng Energy
Performance |
| Timeline |
| Rongsheng Petrochemical |
| Ningxia Baofeng Energy |
Rongsheng Petrochemical and Ningxia Baofeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rongsheng Petrochemical and Ningxia Baofeng
The main advantage of trading using opposite Rongsheng Petrochemical and Ningxia Baofeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rongsheng Petrochemical position performs unexpectedly, Ningxia Baofeng 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 Ningxia Baofeng will offset losses from the drop in Ningxia Baofeng's long position.| Rongsheng Petrochemical vs. Impulse Qingdao Health | Rongsheng Petrochemical vs. Healthcare Co | Rongsheng Petrochemical vs. Beijing Yanjing Brewery | Rongsheng Petrochemical vs. Shanghai Yanpu Metal |
| Ningxia Baofeng vs. Zijin Mining Group | Ningxia Baofeng vs. Wanhua Chemical Group | Ningxia Baofeng vs. Baoshan Iron Steel | Ningxia Baofeng vs. Shandong Gold Mining |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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