Correlation Between Muyuan Foodstuff and China Petroleum
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By analyzing existing cross correlation between Muyuan Foodstuff Co and China Petroleum Chemical, you can compare the effects of market volatilities on Muyuan Foodstuff 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 Muyuan Foodstuff with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Muyuan Foodstuff and China Petroleum.
Diversification Opportunities for Muyuan Foodstuff and China Petroleum
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Muyuan and China is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Muyuan Foodstuff Co 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 Muyuan Foodstuff 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 Muyuan Foodstuff Co 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 Muyuan Foodstuff i.e., Muyuan Foodstuff and China Petroleum go up and down completely randomly.
Pair Corralation between Muyuan Foodstuff and China Petroleum
Assuming the 90 days trading horizon Muyuan Foodstuff Co is expected to under-perform the China Petroleum. In addition to that, Muyuan Foodstuff is 1.11 times more volatile than China Petroleum Chemical. It trades about -0.01 of its total potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.06 per unit of volatility. If you would invest 437.00 in China Petroleum Chemical on August 30, 2024 and sell it today you would earn a total of 201.00 from holding China Petroleum Chemical or generate 46.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Muyuan Foodstuff Co vs. China Petroleum Chemical
Performance |
| Timeline |
| Muyuan Foodstuff |
| China Petroleum Chemical |
Muyuan Foodstuff and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Muyuan Foodstuff and China Petroleum
The main advantage of trading using opposite Muyuan Foodstuff and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Muyuan Foodstuff 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.| Muyuan Foodstuff vs. Industrial and Commercial | Muyuan Foodstuff vs. China Construction Bank | Muyuan Foodstuff vs. Agricultural Bank of | Muyuan Foodstuff vs. Bank of China |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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