Correlation Between China Petroleum and Nanning Chemical
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By analyzing existing cross correlation between China Petroleum Chemical and Nanning Chemical Industry, you can compare the effects of market volatilities on China Petroleum and Nanning Chemical 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 Nanning Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Nanning Chemical.
Diversification Opportunities for China Petroleum and Nanning Chemical
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between China and Nanning is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Nanning Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanning Chemical Industry 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 Nanning Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanning Chemical Industry has no effect on the direction of China Petroleum i.e., China Petroleum and Nanning Chemical go up and down completely randomly.
Pair Corralation between China Petroleum and Nanning Chemical
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.53 times more return on investment than Nanning Chemical. However, China Petroleum Chemical is 1.89 times less risky than Nanning Chemical. It trades about 0.06 of its potential returns per unit of risk. Nanning Chemical Industry is currently generating about 0.03 per unit of risk. If you would invest 440.00 in China Petroleum Chemical on October 11, 2024 and sell it today you would earn a total of 218.00 from holding China Petroleum Chemical or generate 49.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Nanning Chemical Industry
Performance |
| Timeline |
| China Petroleum Chemical |
| Nanning Chemical Industry |
China Petroleum and Nanning Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Nanning Chemical
The main advantage of trading using opposite China Petroleum and Nanning Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Nanning Chemical 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 Nanning Chemical will offset losses from the drop in Nanning Chemical's long position.| China Petroleum vs. Harbin Air Conditioning | China Petroleum vs. Hefei Metalforming Mach | China Petroleum vs. Sunwave Communications Co | China Petroleum vs. Dongfeng Automobile Co |
| Nanning Chemical vs. Chengdu Xinzhu RoadBridge | Nanning Chemical vs. Shanghai Newtouch Software | Nanning Chemical vs. Anhui Transport Consulting | Nanning Chemical vs. Hainan Haiqi Transportation |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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