Correlation Between PetroChina and Wuxi Chemical
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By analyzing existing cross correlation between PetroChina Co Ltd and Wuxi Chemical Equipment, you can compare the effects of market volatilities on PetroChina and Wuxi Chemical 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 Wuxi Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Wuxi Chemical.
Diversification Opportunities for PetroChina and Wuxi Chemical
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and Wuxi is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Wuxi Chemical Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuxi Chemical Equipment 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 Wuxi Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuxi Chemical Equipment has no effect on the direction of PetroChina i.e., PetroChina and Wuxi Chemical go up and down completely randomly.
Pair Corralation between PetroChina and Wuxi Chemical
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.77 times more return on investment than Wuxi Chemical. However, PetroChina Co Ltd is 1.3 times less risky than Wuxi Chemical. It trades about 0.07 of its potential returns per unit of risk. Wuxi Chemical Equipment is currently generating about -0.01 per unit of risk. If you would invest 506.00 in PetroChina Co Ltd on October 16, 2024 and sell it today you would earn a total of 381.00 from holding PetroChina Co Ltd or generate 75.3% 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. Wuxi Chemical Equipment
Performance |
| Timeline |
| PetroChina |
| Wuxi Chemical Equipment |
PetroChina and Wuxi Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Wuxi Chemical
The main advantage of trading using opposite PetroChina and Wuxi Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Wuxi Chemical 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 Wuxi Chemical will offset losses from the drop in Wuxi Chemical's long position.| PetroChina vs. Qijing Machinery | PetroChina vs. Allied Machinery Co | PetroChina vs. Hunan Tyen Machinery | PetroChina vs. Masterwork Machinery |
| Wuxi Chemical vs. Biwin Storage Technology | Wuxi Chemical vs. PetroChina Co Ltd | Wuxi Chemical vs. Industrial and Commercial | Wuxi Chemical 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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