Correlation Between PetroChina and Jiangsu Changfa
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By analyzing existing cross correlation between PetroChina Co Ltd and Jiangsu Changfa Refrigeration, you can compare the effects of market volatilities on PetroChina and Jiangsu Changfa 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 Jiangsu Changfa. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Jiangsu Changfa.
Diversification Opportunities for PetroChina and Jiangsu Changfa
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and Jiangsu is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Jiangsu Changfa Refrigeration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Changfa Refr 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 Jiangsu Changfa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Changfa Refr has no effect on the direction of PetroChina i.e., PetroChina and Jiangsu Changfa go up and down completely randomly.
Pair Corralation between PetroChina and Jiangsu Changfa
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.46 times more return on investment than Jiangsu Changfa. However, PetroChina Co Ltd is 2.19 times less risky than Jiangsu Changfa. It trades about 0.11 of its potential returns per unit of risk. Jiangsu Changfa Refrigeration is currently generating about 0.03 per unit of risk. If you would invest 820.00 in PetroChina Co Ltd on September 5, 2024 and sell it today you would earn a total of 24.00 from holding PetroChina Co Ltd or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Jiangsu Changfa Refrigeration
Performance |
| Timeline |
| PetroChina |
| Jiangsu Changfa Refr |
PetroChina and Jiangsu Changfa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Jiangsu Changfa
The main advantage of trading using opposite PetroChina and Jiangsu Changfa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Jiangsu Changfa 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 Jiangsu Changfa will offset losses from the drop in Jiangsu Changfa's long position.| PetroChina vs. Aofu Environmental Technology | PetroChina vs. Bengang Steel Plates | PetroChina vs. Guangzhou Jointas Chemical | PetroChina vs. Shenyang Chemical Industry |
| Jiangsu Changfa vs. PetroChina Co Ltd | Jiangsu Changfa vs. China Mobile Limited | Jiangsu Changfa vs. CNOOC Limited | Jiangsu Changfa vs. Ping An Insurance |
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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