Correlation Between Jonjee Hi and PetroChina

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Can any of the company-specific risk be diversified away by investing in both Jonjee Hi and PetroChina at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Jonjee Hi and PetroChina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jonjee Hi tech Industrial and PetroChina Co Ltd, you can compare the effects of market volatilities on Jonjee Hi 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 Jonjee Hi with a short position of PetroChina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jonjee Hi and PetroChina.

Diversification Opportunities for Jonjee Hi and PetroChina

-0.15
  Correlation Coefficient

Good diversification

The 3 months correlation between Jonjee and PetroChina is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Jonjee Hi tech Industrial and PetroChina Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PetroChina and Jonjee Hi 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 Jonjee Hi tech Industrial 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 Jonjee Hi i.e., Jonjee Hi and PetroChina go up and down completely randomly.

Pair Corralation between Jonjee Hi and PetroChina

Assuming the 90 days trading horizon Jonjee Hi tech Industrial is expected to under-perform the PetroChina. In addition to that, Jonjee Hi is 1.25 times more volatile than PetroChina Co Ltd. It trades about -0.05 of its total potential returns per unit of risk. PetroChina Co Ltd is currently generating about 0.04 per unit of volatility. If you would invest  707.00  in PetroChina Co Ltd on August 24, 2024 and sell it today you would earn a total of  104.00  from holding PetroChina Co Ltd or generate 14.71% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Jonjee Hi tech Industrial  vs.  PetroChina Co Ltd

 Performance 
       Timeline  
Jonjee Hi tech 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Jonjee Hi tech Industrial are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jonjee Hi sustained solid returns over the last few months and may actually be approaching a breakup point.
PetroChina 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days PetroChina Co Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Jonjee Hi and PetroChina Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jonjee Hi and PetroChina

The main advantage of trading using opposite Jonjee Hi and PetroChina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jonjee Hi 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.
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The idea behind Jonjee Hi tech Industrial and PetroChina Co Ltd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.

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