Correlation Between PetroChina and Guocheng Mining
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By analyzing existing cross correlation between PetroChina Co Ltd and Guocheng Mining Co, you can compare the effects of market volatilities on PetroChina and Guocheng Mining 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 Guocheng Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Guocheng Mining.
Diversification Opportunities for PetroChina and Guocheng Mining
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between PetroChina and Guocheng is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Guocheng Mining Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guocheng Mining 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 Guocheng Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guocheng Mining has no effect on the direction of PetroChina i.e., PetroChina and Guocheng Mining go up and down completely randomly.
Pair Corralation between PetroChina and Guocheng Mining
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Guocheng Mining. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 4.64 times less risky than Guocheng Mining. The stock trades about -0.17 of its potential returns per unit of risk. The Guocheng Mining Co is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,191 in Guocheng Mining Co on September 2, 2024 and sell it today you would earn a total of 220.00 from holding Guocheng Mining Co or generate 18.47% 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. Guocheng Mining Co
Performance |
| Timeline |
| PetroChina |
| Guocheng Mining |
PetroChina and Guocheng Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Guocheng Mining
The main advantage of trading using opposite PetroChina and Guocheng Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Guocheng Mining 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 Guocheng Mining will offset losses from the drop in Guocheng Mining's long position.| PetroChina vs. Zotye Automobile Co | PetroChina vs. Zhejiang Qianjiang Motorcycle | PetroChina vs. Miracll Chemicals Co | PetroChina vs. Bus Online Co |
| Guocheng Mining vs. Kweichow Moutai Co | Guocheng Mining vs. Contemporary Amperex Technology | Guocheng Mining vs. G bits Network Technology | Guocheng Mining vs. BYD Co Ltd |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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