Correlation Between Tianjin Capital and China Petroleum
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By analyzing existing cross correlation between Tianjin Capital Environmental and China Petroleum Chemical, you can compare the effects of market volatilities on Tianjin Capital and China Petroleum 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 Tianjin Capital with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianjin Capital and China Petroleum.
Diversification Opportunities for Tianjin Capital and China Petroleum
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tianjin and China is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Tianjin Capital Environmental and China Petroleum Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Petroleum Chemical and Tianjin Capital 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 Tianjin Capital Environmental are associated (or correlated) with China Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Petroleum Chemical has no effect on the direction of Tianjin Capital i.e., Tianjin Capital and China Petroleum go up and down completely randomly.
Pair Corralation between Tianjin Capital and China Petroleum
Assuming the 90 days trading horizon Tianjin Capital Environmental is expected to under-perform the China Petroleum. In addition to that, Tianjin Capital is 1.4 times more volatile than China Petroleum Chemical. It trades about -0.09 of its total potential returns per unit of risk. China Petroleum Chemical is currently generating about -0.06 per unit of volatility. If you would invest 644.00 in China Petroleum Chemical on August 28, 2024 and sell it today you would lose (11.00) from holding China Petroleum Chemical or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianjin Capital Environmental vs. China Petroleum Chemical
Performance |
| Timeline |
| Tianjin Capital Envi |
| China Petroleum Chemical |
Tianjin Capital and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianjin Capital and China Petroleum
The main advantage of trading using opposite Tianjin Capital and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianjin Capital position performs unexpectedly, China Petroleum 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 Petroleum will offset losses from the drop in China Petroleum's long position.| Tianjin Capital vs. Hainan Haiqi Transportation | Tianjin Capital vs. Zhengping RoadBridge Constr | Tianjin Capital vs. Jinhe Biotechnology Co | Tianjin Capital vs. Niutech Environment Technology |
| China Petroleum vs. Hefei Metalforming Mach | China Petroleum vs. Xinjiang Baodi Mining | China Petroleum vs. Guangdong Jingyi Metal | China Petroleum vs. Hainan Mining Co |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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