Correlation Between PetroChina and State Grid
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By analyzing existing cross correlation between PetroChina Co Ltd and State Grid InformationCommunication, you can compare the effects of market volatilities on PetroChina and State Grid 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 State Grid. Check out your portfolio center. Please also check ongoing floating volatility patterns of PetroChina and State Grid.
Diversification Opportunities for PetroChina and State Grid
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PetroChina and State is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding PetroChina Co Ltd and State Grid InformationCommunic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Grid Informati 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 State Grid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Grid Informati has no effect on the direction of PetroChina i.e., PetroChina and State Grid go up and down completely randomly.
Pair Corralation between PetroChina and State Grid
Assuming the 90 days trading horizon PetroChina Co Ltd is expected to under-perform the State Grid. But the stock apears to be less risky and, when comparing its historical volatility, PetroChina Co Ltd is 4.79 times less risky than State Grid. The stock trades about -0.17 of its potential returns per unit of risk. The State Grid InformationCommunication is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,956 in State Grid InformationCommunication on September 2, 2024 and sell it today you would earn a total of 266.00 from holding State Grid InformationCommunication or generate 13.6% 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. State Grid InformationCommunic
Performance |
| Timeline |
| PetroChina |
| State Grid Informati |
PetroChina and State Grid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PetroChina and State Grid
The main advantage of trading using opposite PetroChina and State Grid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PetroChina position performs unexpectedly, State Grid 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 State Grid will offset losses from the drop in State Grid's long position.| PetroChina vs. Zotye Automobile Co | PetroChina vs. Zhejiang Qianjiang Motorcycle | PetroChina vs. Miracll Chemicals Co | PetroChina vs. Bus Online Co |
| State Grid vs. Tibet Huayu Mining | State Grid vs. China Sports Industry | State Grid vs. Shandong Mining Machinery | State Grid vs. Qingdao Choho Industrial |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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