Correlation Between CNOOC and China World
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By analyzing existing cross correlation between CNOOC Limited and China World Trade, you can compare the effects of market volatilities on CNOOC and China World 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 World. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNOOC and China World.
Diversification Opportunities for CNOOC and China World
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CNOOC and China is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding CNOOC Limited and China World Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China World Trade 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 World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China World Trade has no effect on the direction of CNOOC i.e., CNOOC and China World go up and down completely randomly.
Pair Corralation between CNOOC and China World
Assuming the 90 days trading horizon CNOOC Limited is expected to under-perform the China World. In addition to that, CNOOC is 1.18 times more volatile than China World Trade. It trades about -0.04 of its total potential returns per unit of risk. China World Trade is currently generating about 0.04 per unit of volatility. If you would invest 2,282 in China World Trade on September 28, 2024 and sell it today you would earn a total of 145.00 from holding China World Trade or generate 6.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CNOOC Limited vs. China World Trade
Performance |
| Timeline |
| CNOOC Limited |
| China World Trade |
CNOOC and China World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNOOC and China World
The main advantage of trading using opposite CNOOC and China World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNOOC position performs unexpectedly, China World 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 World will offset losses from the drop in China World's long position.| CNOOC vs. Zhejiang Kingland Pipeline | CNOOC vs. Xiandai Investment Co | CNOOC vs. Xiangyang Automobile Bearing | CNOOC vs. Yunnan Xiyi Industrial |
| China World vs. Tianshui Huatian Technology | China World vs. Uxi Unicomp Technology | China World vs. Olympic Circuit Technology | China World vs. Pengxin International Mining |
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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