Correlation Between PetroChina and Ligao Foods
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By analyzing existing cross correlation between PetroChina Co Ltd and Ligao Foods CoLtd, you can compare the effects of market volatilities on PetroChina and Ligao Foods 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 Ligao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Ligao Foods.
Diversification Opportunities for PetroChina and Ligao Foods
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between PetroChina and Ligao is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Ligao Foods CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ligao Foods CoLtd 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 Ligao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ligao Foods CoLtd has no effect on the direction of PetroChina i.e., PetroChina and Ligao Foods go up and down completely randomly.
Pair Corralation between PetroChina and Ligao Foods
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Ligao Foods. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 2.87 times less risky than Ligao Foods. The stock trades about -0.09 of its potential returns per unit of risk. The Ligao Foods CoLtd is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,540 in Ligao Foods CoLtd on August 30, 2024 and sell it today you would earn a total of 63.00 from holding Ligao Foods CoLtd or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Ligao Foods CoLtd
Performance |
| Timeline |
| PetroChina |
| Ligao Foods CoLtd |
PetroChina and Ligao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Ligao Foods
The main advantage of trading using opposite PetroChina and Ligao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Ligao Foods 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 Ligao Foods will offset losses from the drop in Ligao Foods' long position.| PetroChina vs. Zoy Home Furnishing | PetroChina vs. Fiberhome Telecommunication Technologies | PetroChina vs. 360 Security Technology | PetroChina vs. Maxvision Technology Corp |
| Ligao Foods vs. Industrial and Commercial | Ligao Foods vs. China Construction Bank | Ligao Foods vs. Agricultural Bank of | Ligao Foods vs. Bank of China |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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