Correlation Between China Petroleum and Chengdu Bright
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By analyzing existing cross correlation between China Petroleum Chemical and Chengdu Bright Eye, you can compare the effects of market volatilities on China Petroleum and Chengdu Bright 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 Chengdu Bright. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Chengdu Bright.
Diversification Opportunities for China Petroleum and Chengdu Bright
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Chengdu is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Chengdu Bright Eye in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Bright Eye 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 Chengdu Bright. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Bright Eye has no effect on the direction of China Petroleum i.e., China Petroleum and Chengdu Bright go up and down completely randomly.
Pair Corralation between China Petroleum and Chengdu Bright
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.43 times more return on investment than Chengdu Bright. However, China Petroleum Chemical is 2.31 times less risky than Chengdu Bright. It trades about 0.06 of its potential returns per unit of risk. Chengdu Bright Eye is currently generating about 0.01 per unit of risk. If you would invest 430.00 in China Petroleum Chemical on September 3, 2024 and sell it today you would earn a total of 201.00 from holding China Petroleum Chemical or generate 46.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Chengdu Bright Eye
Performance |
| Timeline |
| China Petroleum Chemical |
| Chengdu Bright Eye |
China Petroleum and Chengdu Bright Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Chengdu Bright
The main advantage of trading using opposite China Petroleum and Chengdu Bright positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Chengdu Bright 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 Chengdu Bright will offset losses from the drop in Chengdu Bright's long position.| China Petroleum vs. Eastern Air Logistics | China Petroleum vs. Ningbo Fangzheng Automobile | China Petroleum vs. Xinhua Winshare Publishing | China Petroleum vs. Jiangsu Phoenix Publishing |
| Chengdu Bright vs. Hainan Haiqi Transportation | Chengdu Bright vs. Everdisplay Optronics Shanghai | Chengdu Bright vs. MayAir Technology Co | Chengdu Bright vs. Sportsoul Co Ltd |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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