Correlation Between PetroChina and Huatian Hotel
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By analyzing existing cross correlation between PetroChina Co Ltd and Huatian Hotel Group, you can compare the effects of market volatilities on PetroChina and Huatian Hotel 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 PetroChina with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Huatian Hotel.
Diversification Opportunities for PetroChina and Huatian Hotel
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and Huatian is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and PetroChina 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 PetroChina Co Ltd are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of PetroChina i.e., PetroChina and Huatian Hotel go up and down completely randomly.
Pair Corralation between PetroChina and Huatian Hotel
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Huatian Hotel. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 2.85 times less risky than Huatian Hotel. The stock trades about -0.17 of its potential returns per unit of risk. The Huatian Hotel Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 338.00 in Huatian Hotel Group on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Huatian Hotel Group or generate 1.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Huatian Hotel Group
Performance |
| Timeline |
| PetroChina |
| Huatian Hotel Group |
PetroChina and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Huatian Hotel
The main advantage of trading using opposite PetroChina and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| PetroChina vs. Jahen Household Products | PetroChina vs. China Railway Materials | PetroChina vs. Shaanxi Meineng Clean | PetroChina vs. Guangzhou Seagull Kitchen |
| Huatian Hotel vs. Biwin Storage Technology | Huatian Hotel vs. PetroChina Co Ltd | Huatian Hotel vs. Industrial and Commercial | Huatian Hotel vs. China Construction Bank |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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