Correlation Between China Petroleum and China Satellite
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By analyzing existing cross correlation between China Petroleum Chemical and China Satellite Communications, you can compare the effects of market volatilities on China Petroleum and China Satellite 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 China Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and China Satellite.
Diversification Opportunities for China Petroleum and China Satellite
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and China is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and China Satellite Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Satellite Comm 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 China Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Satellite Comm has no effect on the direction of China Petroleum i.e., China Petroleum and China Satellite go up and down completely randomly.
Pair Corralation between China Petroleum and China Satellite
Assuming the 90 days trading horizon China Petroleum Chemical is expected to under-perform the China Satellite. But the stock apears to be less risky and, when comparing its historical volatility, China Petroleum Chemical is 5.3 times less risky than China Satellite. The stock trades about -0.04 of its potential returns per unit of risk. The China Satellite Communications is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,733 in China Satellite Communications on August 29, 2024 and sell it today you would earn a total of 284.00 from holding China Satellite Communications or generate 16.39% 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. China Satellite Communications
Performance |
| Timeline |
| China Petroleum Chemical |
| China Satellite Comm |
China Petroleum and China Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and China Satellite
The main advantage of trading using opposite China Petroleum and China Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, China Satellite 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 China Satellite will offset losses from the drop in China Satellite's long position.| China Petroleum vs. Anhui Huilong Agricultural | China Petroleum vs. Chinese Universe Publishing | China Petroleum vs. Shanghai Action Education | China Petroleum vs. Time Publishing and |
| China Satellite vs. Industrial and Commercial | China Satellite vs. Agricultural Bank of | China Satellite vs. China Construction Bank | China Satellite vs. Bank of China |
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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