Correlation Between PetroChina and Dongnan Electronics
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By analyzing existing cross correlation between PetroChina Co Ltd and Dongnan Electronics Co, you can compare the effects of market volatilities on PetroChina and Dongnan Electronics 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 Dongnan Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and Dongnan Electronics.
Diversification Opportunities for PetroChina and Dongnan Electronics
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between PetroChina and Dongnan is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and Dongnan Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongnan Electronics 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 Dongnan Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongnan Electronics has no effect on the direction of PetroChina i.e., PetroChina and Dongnan Electronics go up and down completely randomly.
Pair Corralation between PetroChina and Dongnan Electronics
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the Dongnan Electronics. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 5.46 times less risky than Dongnan Electronics. The stock trades about -0.03 of its potential returns per unit of risk. The Dongnan Electronics Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,344 in Dongnan Electronics Co on September 1, 2024 and sell it today you would earn a total of 126.00 from holding Dongnan Electronics Co or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PetroChina Co Ltd vs. Dongnan Electronics Co
Performance |
| Timeline |
| PetroChina |
| Dongnan Electronics |
PetroChina and Dongnan Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and Dongnan Electronics
The main advantage of trading using opposite PetroChina and Dongnan Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, Dongnan Electronics 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 Dongnan Electronics will offset losses from the drop in Dongnan Electronics' long position.| PetroChina vs. Dongjiang Environmental Co | PetroChina vs. Tonghua Grape Wine | PetroChina vs. Dezhan HealthCare Co | PetroChina vs. Guangdong Liantai Environmental |
| Dongnan Electronics vs. Cultural Investment Holdings | Dongnan Electronics vs. Gome Telecom Equipment | Dongnan Electronics vs. Bus Online Co | Dongnan Electronics vs. Holitech Technology 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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