Correlation Between Hua Xia and China Petroleum
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By analyzing existing cross correlation between Hua Xia Bank and China Petroleum Chemical, you can compare the effects of market volatilities on Hua Xia 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 Hua Xia with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hua Xia and China Petroleum.
Diversification Opportunities for Hua Xia and China Petroleum
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hua and China is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Hua Xia Bank 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 Hua Xia 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 Hua Xia Bank 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 Hua Xia i.e., Hua Xia and China Petroleum go up and down completely randomly.
Pair Corralation between Hua Xia and China Petroleum
Assuming the 90 days trading horizon Hua Xia Bank is expected to generate 0.83 times more return on investment than China Petroleum. However, Hua Xia Bank is 1.21 times less risky than China Petroleum. It trades about 0.08 of its potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.06 per unit of risk. If you would invest 483.00 in Hua Xia Bank on September 12, 2024 and sell it today you would earn a total of 299.00 from holding Hua Xia Bank or generate 61.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hua Xia Bank vs. China Petroleum Chemical
Performance |
| Timeline |
| Hua Xia Bank |
| China Petroleum Chemical |
Hua Xia and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hua Xia and China Petroleum
The main advantage of trading using opposite Hua Xia and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hua Xia 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.| Hua Xia vs. China Petroleum Chemical | Hua Xia vs. PetroChina Co Ltd | Hua Xia vs. China Mobile Limited | Hua Xia vs. Industrial and Commercial |
| 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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