Correlation Between Nanxing Furniture and China Petroleum
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By analyzing existing cross correlation between Nanxing Furniture Machinery and China Petroleum Chemical, you can compare the effects of market volatilities on Nanxing Furniture 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 Nanxing Furniture with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and China Petroleum.
Diversification Opportunities for Nanxing Furniture and China Petroleum
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nanxing and China is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery 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 Nanxing Furniture 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 Nanxing Furniture Machinery 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 Nanxing Furniture i.e., Nanxing Furniture and China Petroleum go up and down completely randomly.
Pair Corralation between Nanxing Furniture and China Petroleum
Assuming the 90 days trading horizon Nanxing Furniture Machinery is expected to generate 1.88 times more return on investment than China Petroleum. However, Nanxing Furniture is 1.88 times more volatile than China Petroleum Chemical. It trades about 0.04 of its potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.04 per unit of risk. If you would invest 1,407 in Nanxing Furniture Machinery on August 26, 2024 and sell it today you would earn a total of 303.00 from holding Nanxing Furniture Machinery or generate 21.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanxing Furniture Machinery vs. China Petroleum Chemical
Performance |
| Timeline |
| Nanxing Furniture |
| China Petroleum Chemical |
Nanxing Furniture and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and China Petroleum
The main advantage of trading using opposite Nanxing Furniture and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture 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.| Nanxing Furniture vs. Biwin Storage Technology | Nanxing Furniture vs. PetroChina Co Ltd | Nanxing Furniture vs. Industrial and Commercial | Nanxing Furniture vs. China Construction Bank |
| China Petroleum vs. DO Home Collection | China Petroleum vs. Shandong Polymer Biochemicals | China Petroleum vs. Nanxing Furniture Machinery | China Petroleum vs. Arrow Home Group |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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