Correlation Between PetroChina and Guangdong Electric
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By analyzing existing cross correlation between PetroChina Co Ltd and Guangdong Electric Power, you can compare the effects of market volatilities on PetroChina and Guangdong Electric 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 Guangdong Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Guangdong Electric.
Diversification Opportunities for PetroChina and Guangdong Electric
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PetroChina and Guangdong is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Guangdong Electric Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Electric Power 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 Guangdong Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Electric Power has no effect on the direction of PetroChina i.e., PetroChina and Guangdong Electric go up and down completely randomly.
Pair Corralation between PetroChina and Guangdong Electric
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 2.14 times more return on investment than Guangdong Electric. However, PetroChina is 2.14 times more volatile than Guangdong Electric Power. It trades about 0.06 of its potential returns per unit of risk. Guangdong Electric Power is currently generating about -0.01 per unit of risk. If you would invest 502.00 in PetroChina Co Ltd on October 29, 2024 and sell it today you would earn a total of 320.00 from holding PetroChina Co Ltd or generate 63.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Guangdong Electric Power
Performance |
| Timeline |
| PetroChina |
| Guangdong Electric Power |
PetroChina and Guangdong Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Guangdong Electric
The main advantage of trading using opposite PetroChina and Guangdong Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Guangdong Electric 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 Guangdong Electric will offset losses from the drop in Guangdong Electric's long position.| PetroChina vs. Shenzhen Topway Video | PetroChina vs. Ningbo Fangzheng Automobile | PetroChina vs. Zotye Automobile Co | PetroChina vs. Meinian Onehealth Healthcare |
| Guangdong Electric vs. Guilin Seamild Foods | Guangdong Electric vs. Anji Foodstuff Co | Guangdong Electric vs. Queclink Wireless Solutions | Guangdong Electric vs. Lootom Telcovideo Network |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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