Correlation Between Chongqing Brewery and CNPC Capital
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By analyzing existing cross correlation between Chongqing Brewery Co and CNPC Capital Co, you can compare the effects of market volatilities on Chongqing Brewery and CNPC Capital 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 Chongqing Brewery with a short position of CNPC Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Brewery and CNPC Capital.
Diversification Opportunities for Chongqing Brewery and CNPC Capital
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Chongqing and CNPC is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Brewery Co and CNPC Capital Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNPC Capital and Chongqing Brewery 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 Chongqing Brewery Co are associated (or correlated) with CNPC Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNPC Capital has no effect on the direction of Chongqing Brewery i.e., Chongqing Brewery and CNPC Capital go up and down completely randomly.
Pair Corralation between Chongqing Brewery and CNPC Capital
Assuming the 90 days trading horizon Chongqing Brewery Co is expected to under-perform the CNPC Capital. In addition to that, Chongqing Brewery is 1.12 times more volatile than CNPC Capital Co. It trades about -0.14 of its total potential returns per unit of risk. CNPC Capital Co is currently generating about -0.12 per unit of volatility. If you would invest 727.00 in CNPC Capital Co on October 26, 2024 and sell it today you would lose (61.00) from holding CNPC Capital Co or give up 8.39% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 97.73% |
Values | Daily Returns |
Chongqing Brewery Co vs. CNPC Capital Co
Performance |
Timeline |
Chongqing Brewery |
CNPC Capital |
Chongqing Brewery and CNPC Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Chongqing Brewery and CNPC Capital
The main advantage of trading using opposite Chongqing Brewery and CNPC Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Brewery position performs unexpectedly, CNPC Capital 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 CNPC Capital will offset losses from the drop in CNPC Capital's long position.Chongqing Brewery vs. Songz Automobile Air | Chongqing Brewery vs. Beijing Mainstreets Investment | Chongqing Brewery vs. Hubei Geoway Investment | Chongqing Brewery vs. Nuode Investment Co |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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