Correlation Between China Petroleum and Guangdong Liantai
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By analyzing existing cross correlation between China Petroleum Chemical and Guangdong Liantai Environmental, you can compare the effects of market volatilities on China Petroleum and Guangdong Liantai 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 Guangdong Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Guangdong Liantai.
Diversification Opportunities for China Petroleum and Guangdong Liantai
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Guangdong is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai 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 Guangdong Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of China Petroleum i.e., China Petroleum and Guangdong Liantai go up and down completely randomly.
Pair Corralation between China Petroleum and Guangdong Liantai
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.81 times more return on investment than Guangdong Liantai. However, China Petroleum Chemical is 1.24 times less risky than Guangdong Liantai. It trades about 0.06 of its potential returns per unit of risk. Guangdong Liantai Environmental is currently generating about -0.02 per unit of risk. If you would invest 426.00 in China Petroleum Chemical on September 24, 2024 and sell it today you would earn a total of 212.00 from holding China Petroleum Chemical or generate 49.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
China Petroleum Chemical vs. Guangdong Liantai Environmenta
Performance |
Timeline |
China Petroleum Chemical |
Guangdong Liantai |
China Petroleum and Guangdong Liantai Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Petroleum and Guangdong Liantai
The main advantage of trading using opposite China Petroleum and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Guangdong Liantai 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 Guangdong Liantai will offset losses from the drop in Guangdong Liantai's long position.China Petroleum vs. Guangdong Liantai Environmental | China Petroleum vs. China Asset Management | China Petroleum vs. Sinocat Environmental Technology | China Petroleum vs. Grandblue Environment Co |
Guangdong Liantai vs. Ming Yang Smart | Guangdong Liantai vs. 159681 | Guangdong Liantai vs. 159005 | Guangdong Liantai vs. Loctek Ergonomic Technology |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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