Correlation Between China Express and PetroChina
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By analyzing existing cross correlation between China Express Airlines and PetroChina Co Ltd, you can compare the effects of market volatilities on China Express and PetroChina 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 Express with a short position of PetroChina. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Express and PetroChina.
Diversification Opportunities for China Express and PetroChina
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and PetroChina is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding China Express Airlines and PetroChina Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroChina and China Express 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 Express Airlines are associated (or correlated) with PetroChina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PetroChina has no effect on the direction of China Express i.e., China Express and PetroChina go up and down completely randomly.
Pair Corralation between China Express and PetroChina
Assuming the 90 days trading horizon China Express Airlines is expected to under-perform the PetroChina. In addition to that, China Express is 1.24 times more volatile than PetroChina Co Ltd. It trades about -0.03 of its total potential returns per unit of risk. PetroChina Co Ltd is currently generating about 0.06 per unit of volatility. If you would invest 495.00 in PetroChina Co Ltd on September 3, 2024 and sell it today you would earn a total of 309.00 from holding PetroChina Co Ltd or generate 62.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Express Airlines vs. PetroChina Co Ltd
Performance |
| Timeline |
| China Express Airlines |
| PetroChina |
China Express and PetroChina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Express and PetroChina
The main advantage of trading using opposite China Express and PetroChina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Express position performs unexpectedly, PetroChina 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 PetroChina will offset losses from the drop in PetroChina's long position.| China Express vs. Songz Automobile Air | China Express vs. Zotye Automobile Co | China Express vs. Tongling Nonferrous Metals | China Express vs. CIMC Vehicles Co |
| PetroChina vs. China Express Airlines | PetroChina vs. Xinhua Winshare Publishing | PetroChina vs. Jinhui Liquor Co | PetroChina vs. Beijing Kaiwen Education |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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