Correlation Between Chengdu Kanghua and CNPC Capital
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By analyzing existing cross correlation between Chengdu Kanghua Biological and CNPC Capital Co, you can compare the effects of market volatilities on Chengdu Kanghua and CNPC Capital 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 Chengdu Kanghua with a short position of CNPC Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and CNPC Capital.
Diversification Opportunities for Chengdu Kanghua and CNPC Capital
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengdu and CNPC is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and CNPC Capital Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNPC Capital and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with CNPC Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNPC Capital has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and CNPC Capital go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and CNPC Capital
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to generate 1.0 times more return on investment than CNPC Capital. However, Chengdu Kanghua Biological is 1.0 times less risky than CNPC Capital. It trades about 0.11 of its potential returns per unit of risk. CNPC Capital Co is currently generating about -0.06 per unit of risk. If you would invest 5,587 in Chengdu Kanghua Biological on September 27, 2024 and sell it today you would earn a total of 167.00 from holding Chengdu Kanghua Biological or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. CNPC Capital Co
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| CNPC Capital |
Chengdu Kanghua and CNPC Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and CNPC Capital
The main advantage of trading using opposite Chengdu Kanghua and CNPC Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, CNPC Capital 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 CNPC Capital will offset losses from the drop in CNPC Capital's long position.| Chengdu Kanghua vs. Industrial and Commercial | Chengdu Kanghua vs. Agricultural Bank of | Chengdu Kanghua vs. China Construction Bank | Chengdu Kanghua vs. Bank of China |
| CNPC Capital vs. Ming Yang Smart | CNPC Capital vs. 159681 | CNPC Capital vs. 159005 | CNPC Capital vs. Loctek Ergonomic Technology |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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