Correlation Between China Petroleum and Taiji Computer
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By analyzing existing cross correlation between China Petroleum Chemical and Taiji Computer Corp, you can compare the effects of market volatilities on China Petroleum and Taiji Computer 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 China Petroleum with a short position of Taiji Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Taiji Computer.
Diversification Opportunities for China Petroleum and Taiji Computer
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Taiji is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Taiji Computer Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiji Computer Corp and China Petroleum 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 China Petroleum Chemical are associated (or correlated) with Taiji Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiji Computer Corp has no effect on the direction of China Petroleum i.e., China Petroleum and Taiji Computer go up and down completely randomly.
Pair Corralation between China Petroleum and Taiji Computer
Assuming the 90 days trading horizon China Petroleum Chemical is expected to under-perform the Taiji Computer. But the stock apears to be less risky and, when comparing its historical volatility, China Petroleum Chemical is 2.73 times less risky than Taiji Computer. The stock trades about -0.02 of its potential returns per unit of risk. The Taiji Computer Corp is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,626 in Taiji Computer Corp on September 25, 2024 and sell it today you would earn a total of 830.00 from holding Taiji Computer Corp or generate 51.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
China Petroleum Chemical vs. Taiji Computer Corp
Performance |
Timeline |
China Petroleum Chemical |
Taiji Computer Corp |
China Petroleum and Taiji Computer Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Petroleum and Taiji Computer
The main advantage of trading using opposite China Petroleum and Taiji Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Taiji Computer 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 Taiji Computer will offset losses from the drop in Taiji Computer's long position.China Petroleum vs. Changchun Faway Automobile | China Petroleum vs. Nanjing Putian Telecommunications | China Petroleum vs. Guilin Seamild Foods | China Petroleum vs. Songz Automobile Air |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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