Correlation Between China Petroleum and Shengyuan Environmental
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By analyzing existing cross correlation between China Petroleum Chemical and Shengyuan Environmental Protection, you can compare the effects of market volatilities on China Petroleum and Shengyuan Environmental 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 China Petroleum with a short position of Shengyuan Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Shengyuan Environmental.
Diversification Opportunities for China Petroleum and Shengyuan Environmental
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Shengyuan is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Shengyuan Environmental Protec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shengyuan Environmental and China Petroleum 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 China Petroleum Chemical are associated (or correlated) with Shengyuan Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shengyuan Environmental has no effect on the direction of China Petroleum i.e., China Petroleum and Shengyuan Environmental go up and down completely randomly.
Pair Corralation between China Petroleum and Shengyuan Environmental
Assuming the 90 days trading horizon China Petroleum Chemical is expected to under-perform the Shengyuan Environmental. But the stock apears to be less risky and, when comparing its historical volatility, China Petroleum Chemical is 1.85 times less risky than Shengyuan Environmental. The stock trades about -0.13 of its potential returns per unit of risk. The Shengyuan Environmental Protection is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,390 in Shengyuan Environmental Protection on August 30, 2024 and sell it today you would lose (14.00) from holding Shengyuan Environmental Protection or give up 1.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Shengyuan Environmental Protec
Performance |
| Timeline |
| China Petroleum Chemical |
| Shengyuan Environmental |
China Petroleum and Shengyuan Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Shengyuan Environmental
The main advantage of trading using opposite China Petroleum and Shengyuan Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Shengyuan Environmental 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 Shengyuan Environmental will offset losses from the drop in Shengyuan Environmental's long position.| China Petroleum vs. CareRay Digital Medical | China Petroleum vs. Blue Sail Medical | China Petroleum vs. State Grid InformationCommunication | China Petroleum vs. Jafron Biomedical Co |
| Shengyuan Environmental vs. Agricultural Bank of | Shengyuan Environmental vs. Industrial and Commercial | Shengyuan Environmental vs. Bank of China | Shengyuan Environmental vs. China Construction Bank |
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 CEOs Directory module to screen CEOs from public companies around the world.
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