Correlation Between CNOOC and China Union
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By analyzing existing cross correlation between CNOOC Limited and China Union Holdings, you can compare the effects of market volatilities on CNOOC and China Union 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 CNOOC with a short position of China Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNOOC and China Union.
Diversification Opportunities for CNOOC and China Union
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CNOOC and China is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding CNOOC Limited and China Union Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Union Holdings and CNOOC 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 CNOOC Limited are associated (or correlated) with China Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Union Holdings has no effect on the direction of CNOOC i.e., CNOOC and China Union go up and down completely randomly.
Pair Corralation between CNOOC and China Union
Assuming the 90 days trading horizon CNOOC Limited is expected to generate 0.8 times more return on investment than China Union. However, CNOOC Limited is 1.25 times less risky than China Union. It trades about 0.15 of its potential returns per unit of risk. China Union Holdings is currently generating about -0.71 per unit of risk. If you would invest 2,703 in CNOOC Limited on October 14, 2024 and sell it today you would earn a total of 122.00 from holding CNOOC Limited or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CNOOC Limited vs. China Union Holdings
Performance |
| Timeline |
| CNOOC Limited |
| China Union Holdings |
CNOOC and China Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNOOC and China Union
The main advantage of trading using opposite CNOOC and China Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNOOC position performs unexpectedly, China Union 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 Union will offset losses from the drop in China Union's long position.| CNOOC vs. Beijing Mainstreets Investment | CNOOC vs. Shenzhen SDG Information | CNOOC vs. ButOne Information Corp | CNOOC vs. Hygon Information Technology |
| China Union vs. Pengxin International Mining | China Union vs. Bosera CMSK Industrial | China Union vs. Hangzhou Gisway Information | China Union vs. Guangzhou Haozhi Industrial |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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