Correlation Between China Petroleum and Hefei Metalforming
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By analyzing existing cross correlation between China Petroleum Chemical and Hefei Metalforming Mach, you can compare the effects of market volatilities on China Petroleum and Hefei Metalforming 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 Hefei Metalforming. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Hefei Metalforming.
Diversification Opportunities for China Petroleum and Hefei Metalforming
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Hefei is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Hefei Metalforming Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hefei Metalforming Mach 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 Hefei Metalforming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hefei Metalforming Mach has no effect on the direction of China Petroleum i.e., China Petroleum and Hefei Metalforming go up and down completely randomly.
Pair Corralation between China Petroleum and Hefei Metalforming
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.4 times more return on investment than Hefei Metalforming. However, China Petroleum Chemical is 2.52 times less risky than Hefei Metalforming. It trades about -0.09 of its potential returns per unit of risk. Hefei Metalforming Mach is currently generating about -0.1 per unit of risk. If you would invest 633.00 in China Petroleum Chemical on October 26, 2024 and sell it today you would lose (30.00) from holding China Petroleum Chemical or give up 4.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Petroleum Chemical vs. Hefei Metalforming Mach
Performance |
| Timeline |
| China Petroleum Chemical |
| Hefei Metalforming Mach |
China Petroleum and Hefei Metalforming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Petroleum and Hefei Metalforming
The main advantage of trading using opposite China Petroleum and Hefei Metalforming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Hefei Metalforming 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 Hefei Metalforming will offset losses from the drop in Hefei Metalforming's long position.| China Petroleum vs. JuneYao Dairy Co | China Petroleum vs. Everjoy Health Group | China Petroleum vs. Jiahe Foods Industry | China Petroleum vs. Meinian Onehealth Healthcare |
| Hefei Metalforming vs. PetroChina Co Ltd | Hefei Metalforming vs. Industrial and Commercial | Hefei Metalforming vs. China Petroleum Chemical | Hefei Metalforming vs. China Construction Bank |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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