Correlation Between Changchun BCHT and China Petroleum
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and China Petroleum Chemical, you can compare the effects of market volatilities on Changchun BCHT 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 Changchun BCHT with a short position of China Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and China Petroleum.
Diversification Opportunities for Changchun BCHT and China Petroleum
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Changchun and China is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology 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 Changchun BCHT 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 Changchun BCHT Biotechnology 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 Changchun BCHT i.e., Changchun BCHT and China Petroleum go up and down completely randomly.
Pair Corralation between Changchun BCHT and China Petroleum
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to generate 3.03 times more return on investment than China Petroleum. However, Changchun BCHT is 3.03 times more volatile than China Petroleum Chemical. It trades about 0.04 of its potential returns per unit of risk. China Petroleum Chemical is currently generating about 0.12 per unit of risk. If you would invest 2,595 in Changchun BCHT Biotechnology on September 3, 2024 and sell it today you would earn a total of 42.00 from holding Changchun BCHT Biotechnology or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. China Petroleum Chemical
Performance |
| Timeline |
| Changchun BCHT Biote |
| China Petroleum Chemical |
Changchun BCHT and China Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and China Petroleum
The main advantage of trading using opposite Changchun BCHT and China Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT 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.| Changchun BCHT vs. Chengdu Kanghua Biological | Changchun BCHT vs. Beijing Wantai Biological | Changchun BCHT vs. Suzhou Novoprotein Scientific | Changchun BCHT vs. Aluminum Corp of |
| China Petroleum vs. Eastern Air Logistics | China Petroleum vs. Ningbo Fangzheng Automobile | China Petroleum vs. Xinhua Winshare Publishing | China Petroleum vs. Jiangsu Phoenix Publishing |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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