Correlation Between PetroChina and Ningbo GQY
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By analyzing existing cross correlation between PetroChina Co Ltd and Ningbo GQY Video, you can compare the effects of market volatilities on PetroChina and Ningbo GQY 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 Ningbo GQY. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Ningbo GQY.
Diversification Opportunities for PetroChina and Ningbo GQY
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PetroChina and Ningbo is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Ningbo GQY Video in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo GQY Video 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 Ningbo GQY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo GQY Video has no effect on the direction of PetroChina i.e., PetroChina and Ningbo GQY go up and down completely randomly.
Pair Corralation between PetroChina and Ningbo GQY
Assuming the 90 days trading horizon PetroChina is expected to generate 6.04 times less return on investment than Ningbo GQY. But when comparing it to its historical volatility, PetroChina Co Ltd is 4.32 times less risky than Ningbo GQY. It trades about 0.22 of its potential returns per unit of risk. Ningbo GQY Video is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 590.00 in Ningbo GQY Video on September 13, 2024 and sell it today you would earn a total of 215.00 from holding Ningbo GQY Video or generate 36.44% 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. Ningbo GQY Video
Performance |
| Timeline |
| PetroChina |
| Ningbo GQY Video |
PetroChina and Ningbo GQY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Ningbo GQY
The main advantage of trading using opposite PetroChina and Ningbo GQY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Ningbo GQY 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 Ningbo GQY will offset losses from the drop in Ningbo GQY's long position.| PetroChina vs. Ningxia Building Materials | PetroChina vs. Chongqing Sulian Plastic | PetroChina vs. Guangzhou Tinci Materials | PetroChina vs. Tianjin Pengling Rubber |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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