Correlation Between PetroChina and Chengdu Xinzhu
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By analyzing existing cross correlation between PetroChina Co Ltd and Chengdu Xinzhu RoadBridge, you can compare the effects of market volatilities on PetroChina and Chengdu Xinzhu 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 Chengdu Xinzhu. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Chengdu Xinzhu.
Diversification Opportunities for PetroChina and Chengdu Xinzhu
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between PetroChina and Chengdu is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Chengdu Xinzhu RoadBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Xinzhu RoadBridge 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 Chengdu Xinzhu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Xinzhu RoadBridge has no effect on the direction of PetroChina i.e., PetroChina and Chengdu Xinzhu go up and down completely randomly.
Pair Corralation between PetroChina and Chengdu Xinzhu
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Chengdu Xinzhu. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 2.57 times less risky than Chengdu Xinzhu. The stock trades about -0.41 of its potential returns per unit of risk. The Chengdu Xinzhu RoadBridge is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 530.00 in Chengdu Xinzhu RoadBridge on November 27, 2024 and sell it today you would earn a total of 13.00 from holding Chengdu Xinzhu RoadBridge or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Chengdu Xinzhu RoadBridge
Performance |
| Timeline |
| PetroChina |
| Chengdu Xinzhu RoadBridge |
PetroChina and Chengdu Xinzhu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Chengdu Xinzhu
The main advantage of trading using opposite PetroChina and Chengdu Xinzhu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Chengdu Xinzhu 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 Chengdu Xinzhu will offset losses from the drop in Chengdu Xinzhu's long position.| PetroChina vs. Xinxiang Chemical Fiber | PetroChina vs. Duzhe Publishing Media | PetroChina vs. Mega info Media CoLtd | PetroChina vs. Longxing Chemical Stock |
| Chengdu Xinzhu vs. Biwin Storage Technology | Chengdu Xinzhu vs. Shanghai Luoman Lighting | Chengdu Xinzhu vs. Chengdu Kanghua Biological | Chengdu Xinzhu vs. Ningbo Sinyuan ZM |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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