Correlation Between CNOOC and Citic Guoan
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By analyzing existing cross correlation between CNOOC Limited and Citic Guoan Wine, you can compare the effects of market volatilities on CNOOC and Citic Guoan 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 CNOOC with a short position of Citic Guoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNOOC and Citic Guoan.
Diversification Opportunities for CNOOC and Citic Guoan
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CNOOC and Citic is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding CNOOC Limited and Citic Guoan Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citic Guoan Wine and CNOOC 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 CNOOC Limited are associated (or correlated) with Citic Guoan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citic Guoan Wine has no effect on the direction of CNOOC i.e., CNOOC and Citic Guoan go up and down completely randomly.
Pair Corralation between CNOOC and Citic Guoan
Assuming the 90 days trading horizon CNOOC Limited is expected to generate 0.7 times more return on investment than Citic Guoan. However, CNOOC Limited is 1.43 times less risky than Citic Guoan. It trades about 0.07 of its potential returns per unit of risk. Citic Guoan Wine is currently generating about -0.02 per unit of risk. If you would invest 1,961 in CNOOC Limited on September 26, 2024 and sell it today you would earn a total of 914.00 from holding CNOOC Limited or generate 46.61% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CNOOC Limited vs. Citic Guoan Wine
Performance |
Timeline |
CNOOC Limited |
Citic Guoan Wine |
CNOOC and Citic Guoan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CNOOC and Citic Guoan
The main advantage of trading using opposite CNOOC and Citic Guoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNOOC position performs unexpectedly, Citic Guoan 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 Citic Guoan will offset losses from the drop in Citic Guoan's long position.CNOOC vs. Jiangxi Hengda Hi Tech | CNOOC vs. Guangdong Shenglu Telecommunication | CNOOC vs. Xiangyang Automobile Bearing | CNOOC vs. Guangzhou Automobile Group |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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