Correlation Between Ningbo Construction and CNOOC
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By analyzing existing cross correlation between Ningbo Construction Co and CNOOC Limited, you can compare the effects of market volatilities on Ningbo Construction and CNOOC 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 Ningbo Construction with a short position of CNOOC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ningbo Construction and CNOOC.
Diversification Opportunities for Ningbo Construction and CNOOC
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ningbo and CNOOC is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ningbo Construction Co and CNOOC Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNOOC Limited and Ningbo Construction 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 Ningbo Construction Co are associated (or correlated) with CNOOC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNOOC Limited has no effect on the direction of Ningbo Construction i.e., Ningbo Construction and CNOOC go up and down completely randomly.
Pair Corralation between Ningbo Construction and CNOOC
Assuming the 90 days trading horizon Ningbo Construction Co is expected to under-perform the CNOOC. In addition to that, Ningbo Construction is 1.42 times more volatile than CNOOC Limited. It trades about -0.21 of its total potential returns per unit of risk. CNOOC Limited is currently generating about -0.24 per unit of volatility. If you would invest 2,950 in CNOOC Limited on October 30, 2024 and sell it today you would lose (199.00) from holding CNOOC Limited or give up 6.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ningbo Construction Co vs. CNOOC Limited
Performance |
| Timeline |
| Ningbo Construction |
| CNOOC Limited |
Ningbo Construction and CNOOC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ningbo Construction and CNOOC
The main advantage of trading using opposite Ningbo Construction and CNOOC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ningbo Construction position performs unexpectedly, CNOOC 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 CNOOC will offset losses from the drop in CNOOC's long position.| Ningbo Construction vs. Industrial and Commercial | Ningbo Construction vs. China Construction Bank | Ningbo Construction vs. Agricultural Bank of | Ningbo Construction vs. Bank of China |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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