Correlation Between China Petroleum and Industrial Bank
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By analyzing existing cross correlation between China Petroleum Chemical and Industrial Bank Co, you can compare the effects of market volatilities on China Petroleum and Industrial Bank 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 Industrial Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Industrial Bank.
Diversification Opportunities for China Petroleum and Industrial Bank
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and Industrial is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Industrial Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Bank 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 Industrial Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Bank has no effect on the direction of China Petroleum i.e., China Petroleum and Industrial Bank go up and down completely randomly.
Pair Corralation between China Petroleum and Industrial Bank
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.77 times more return on investment than Industrial Bank. However, China Petroleum Chemical is 1.3 times less risky than Industrial Bank. It trades about 0.19 of its potential returns per unit of risk. Industrial Bank Co is currently generating about 0.07 per unit of risk. 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 Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Industrial Bank Co
Performance |
| Timeline |
| China Petroleum Chemical |
| Industrial Bank |
China Petroleum and Industrial Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Industrial Bank
The main advantage of trading using opposite China Petroleum and Industrial Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Industrial Bank 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 Industrial Bank will offset losses from the drop in Industrial Bank's long position.| China Petroleum vs. Western Superconducting Tech | China Petroleum vs. Holitech Technology Co | China Petroleum vs. Ping An Insurance | China Petroleum vs. Chengdu Xinzhu RoadBridge |
| Industrial Bank vs. China Petroleum Chemical | Industrial Bank vs. PetroChina Co Ltd | Industrial Bank vs. China Mobile Limited | Industrial Bank vs. Industrial and Commercial |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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