Correlation Between PetroChina and Ningbo Fangzheng
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By analyzing existing cross correlation between PetroChina Co Ltd and Ningbo Fangzheng Automobile, you can compare the effects of market volatilities on PetroChina and Ningbo Fangzheng 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 Fangzheng. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Ningbo Fangzheng.
Diversification Opportunities for PetroChina and Ningbo Fangzheng
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PetroChina and Ningbo is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Ningbo Fangzheng Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Fangzheng Aut 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 Fangzheng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Fangzheng Aut has no effect on the direction of PetroChina i.e., PetroChina and Ningbo Fangzheng go up and down completely randomly.
Pair Corralation between PetroChina and Ningbo Fangzheng
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to generate 0.66 times more return on investment than Ningbo Fangzheng. However, PetroChina Co Ltd is 1.51 times less risky than Ningbo Fangzheng. It trades about 0.06 of its potential returns per unit of risk. Ningbo Fangzheng Automobile is currently generating about -0.01 per unit of risk. If you would invest 499.00 in PetroChina Co Ltd on September 4, 2024 and sell it today you would earn a total of 303.00 from holding PetroChina Co Ltd or generate 60.72% 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 Fangzheng Automobile
Performance |
| Timeline |
| PetroChina |
| Ningbo Fangzheng Aut |
PetroChina and Ningbo Fangzheng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Ningbo Fangzheng
The main advantage of trading using opposite PetroChina and Ningbo Fangzheng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Ningbo Fangzheng 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 Fangzheng will offset losses from the drop in Ningbo Fangzheng's long position.| PetroChina vs. Sichuan Hebang Biotechnology | PetroChina vs. Guangdong Marubi Biotechnology | PetroChina vs. Shandong Sanyuan Biotechnology | PetroChina vs. Bloomage Biotechnology Corp |
| Ningbo Fangzheng vs. Great Sun Foods Co | Ningbo Fangzheng vs. Heilongjiang Transport Development | Ningbo Fangzheng vs. Youyou Foods Co | Ningbo Fangzheng vs. Anji Foodstuff Co |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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