Correlation Between China Petroleum and Postal Savings
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By analyzing existing cross correlation between China Petroleum Chemical and Postal Savings Bank, you can compare the effects of market volatilities on China Petroleum and Postal Savings 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 Postal Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Postal Savings.
Diversification Opportunities for China Petroleum and Postal Savings
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Postal is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings 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 Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of China Petroleum i.e., China Petroleum and Postal Savings go up and down completely randomly.
Pair Corralation between China Petroleum and Postal Savings
Assuming the 90 days trading horizon China Petroleum Chemical is expected to under-perform the Postal Savings. But the stock apears to be less risky and, when comparing its historical volatility, China Petroleum Chemical is 1.26 times less risky than Postal Savings. The stock trades about -0.13 of its potential returns per unit of risk. The Postal Savings Bank is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 543.00 in Postal Savings Bank on October 20, 2024 and sell it today you would lose (17.00) from holding Postal Savings Bank or give up 3.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Postal Savings Bank
Performance |
| Timeline |
| China Petroleum Chemical |
| Postal Savings Bank |
China Petroleum and Postal Savings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Postal Savings
The main advantage of trading using opposite China Petroleum and Postal Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Postal Savings 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 Postal Savings will offset losses from the drop in Postal Savings' long position.| China Petroleum vs. Eyebright Medical Technology | China Petroleum vs. Do Fluoride Chemicals Co | China Petroleum vs. Leyard Optoelectronic | China Petroleum vs. Jiangyin Jianghua Microelectronics |
| Postal Savings vs. Ningbo Homelink Eco iTech | Postal Savings vs. Easyhome New Retail | Postal Savings vs. Gansu Jiu Steel | Postal Savings vs. Zoy Home Furnishing |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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