Correlation Between CNOOC and Metro Investment
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By analyzing existing cross correlation between CNOOC Limited and Metro Investment Development, you can compare the effects of market volatilities on CNOOC and Metro Investment 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 Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNOOC and Metro Investment.
Diversification Opportunities for CNOOC and Metro Investment
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CNOOC and Metro is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding CNOOC Limited and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of CNOOC i.e., CNOOC and Metro Investment go up and down completely randomly.
Pair Corralation between CNOOC and Metro Investment
Assuming the 90 days trading horizon CNOOC Limited is expected to generate 0.46 times more return on investment than Metro Investment. However, CNOOC Limited is 2.19 times less risky than Metro Investment. It trades about 0.14 of its potential returns per unit of risk. Metro Investment Development is currently generating about 0.05 per unit of risk. If you would invest 2,650 in CNOOC Limited on September 24, 2024 and sell it today you would earn a total of 90.00 from holding CNOOC Limited or generate 3.4% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CNOOC Limited vs. Metro Investment Development
Performance |
Timeline |
CNOOC Limited |
Metro Investment Dev |
CNOOC and Metro Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CNOOC and Metro Investment
The main advantage of trading using opposite CNOOC and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNOOC position performs unexpectedly, Metro Investment 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 Metro Investment will offset losses from the drop in Metro Investment's long position.CNOOC vs. Hangzhou Weiguang Electronic | CNOOC vs. Shijiazhuang Tonhe Electronics | CNOOC vs. Xinya Electronic Co | CNOOC vs. LianChuang Electronic Technology |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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