Correlation Between Hengli Petrochemical and State Grid
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By analyzing existing cross correlation between Hengli Petrochemical Co and State Grid InformationCommunication, you can compare the effects of market volatilities on Hengli Petrochemical and State Grid 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 Hengli Petrochemical with a short position of State Grid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengli Petrochemical and State Grid.
Diversification Opportunities for Hengli Petrochemical and State Grid
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hengli and State is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Hengli Petrochemical Co and State Grid InformationCommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Grid Informati and Hengli Petrochemical 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 Hengli Petrochemical Co are associated (or correlated) with State Grid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Grid Informati has no effect on the direction of Hengli Petrochemical i.e., Hengli Petrochemical and State Grid go up and down completely randomly.
Pair Corralation between Hengli Petrochemical and State Grid
Assuming the 90 days trading horizon Hengli Petrochemical is expected to generate 1.44 times less return on investment than State Grid. But when comparing it to its historical volatility, Hengli Petrochemical Co is 1.57 times less risky than State Grid. It trades about 0.04 of its potential returns per unit of risk. State Grid InformationCommunication is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,454 in State Grid InformationCommunication on October 16, 2024 and sell it today you would earn a total of 295.00 from holding State Grid InformationCommunication or generate 20.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengli Petrochemical Co vs. State Grid InformationCommunic
Performance |
| Timeline |
| Hengli Petrochemical |
| State Grid Informati |
Hengli Petrochemical and State Grid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengli Petrochemical and State Grid
The main advantage of trading using opposite Hengli Petrochemical and State Grid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengli Petrochemical position performs unexpectedly, State Grid 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 State Grid will offset losses from the drop in State Grid's long position.| Hengli Petrochemical vs. Zijin Mining Group | Hengli Petrochemical vs. Wanhua Chemical Group | Hengli Petrochemical vs. Baoshan Iron Steel | Hengli Petrochemical vs. Shandong Gold Mining |
| State Grid vs. Guizhou Chanhen Chemical | State Grid vs. Telling Telecommunication Holding | State Grid vs. Hengli Petrochemical Co | State Grid vs. Xiangyang Automobile Bearing |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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