Correlation Between China Petroleum and Sany Heavy
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By analyzing existing cross correlation between China Petroleum Chemical and Sany Heavy Energy, you can compare the effects of market volatilities on China Petroleum and Sany Heavy 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 Sany Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Petroleum and Sany Heavy.
Diversification Opportunities for China Petroleum and Sany Heavy
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Sany is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding China Petroleum Chemical and Sany Heavy Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sany Heavy Energy 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 Sany Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sany Heavy Energy has no effect on the direction of China Petroleum i.e., China Petroleum and Sany Heavy go up and down completely randomly.
Pair Corralation between China Petroleum and Sany Heavy
Assuming the 90 days trading horizon China Petroleum Chemical is expected to generate 0.63 times more return on investment than Sany Heavy. However, China Petroleum Chemical is 1.59 times less risky than Sany Heavy. It trades about -0.21 of its potential returns per unit of risk. Sany Heavy Energy is currently generating about -0.23 per unit of risk. If you would invest 644.00 in China Petroleum Chemical on December 11, 2024 and sell it today you would lose (75.00) from holding China Petroleum Chemical or give up 11.65% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
China Petroleum Chemical vs. Sany Heavy Energy
Performance |
Timeline |
China Petroleum Chemical |
Sany Heavy Energy |
China Petroleum and Sany Heavy Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Petroleum and Sany Heavy
The main advantage of trading using opposite China Petroleum and Sany Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Petroleum position performs unexpectedly, Sany Heavy 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 Sany Heavy will offset losses from the drop in Sany Heavy's long position.China Petroleum vs. Shandong Publishing Media | China Petroleum vs. Fujian Wanchen Biotechnology | China Petroleum vs. Changchun BCHT Biotechnology | China Petroleum vs. Suzhou Douson Drilling |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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