Correlation Between Ningxia Xiaoming and China Petroleum
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By analyzing existing cross correlation between Ningxia Xiaoming Agriculture and China Petroleum Chemical, you can compare the effects of market volatilities on Ningxia Xiaoming 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 Ningxia Xiaoming with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningxia Xiaoming and China Petroleum.
Diversification Opportunities for Ningxia Xiaoming and China Petroleum
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ningxia and China is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Ningxia Xiaoming Agriculture 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 Ningxia Xiaoming 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 Ningxia Xiaoming Agriculture 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 Ningxia Xiaoming i.e., Ningxia Xiaoming and China Petroleum go up and down completely randomly.
Pair Corralation between Ningxia Xiaoming and China Petroleum
Assuming the 90 days trading horizon Ningxia Xiaoming is expected to generate 1.02 times less return on investment than China Petroleum. In addition to that, Ningxia Xiaoming is 3.32 times more volatile than China Petroleum Chemical. It trades about 0.06 of its total potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.19 per unit of volatility. If you would invest 623.00 in China Petroleum Chemical on September 12, 2024 and sell it today you would earn a total of 21.00 from holding China Petroleum Chemical or generate 3.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ningxia Xiaoming Agriculture vs. China Petroleum Chemical
Performance |
| Timeline |
| Ningxia Xiaoming Agr |
| China Petroleum Chemical |
Ningxia Xiaoming and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningxia Xiaoming and China Petroleum
The main advantage of trading using opposite Ningxia Xiaoming and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningxia Xiaoming 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.| Ningxia Xiaoming vs. China Petroleum Chemical | Ningxia Xiaoming vs. PetroChina Co Ltd | Ningxia Xiaoming vs. China State Construction | Ningxia Xiaoming vs. China Railway Group |
| China Petroleum vs. Western Superconducting Tech | China Petroleum vs. Holitech Technology Co | China Petroleum vs. Ping An Insurance | China Petroleum vs. Chengdu Xinzhu RoadBridge |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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